Chainalysis: So far this year, illegal activity funding in the crypto space has decreased by 19.6% to $16.7 billion, indicating that the growth rate of legitimate activities is outpacing that of on-chain illegal activities

ChainCatcher news, Chainalysis pointed out in a blog post that there have been many seemingly positive developments in the cryptocurrency ecosystem this year.

It noted that with the approval of spot Bitcoin and Ethereum ETFs in the U.S. and the Financial Accounting Standards Board (FASB) revising fair accounting rules, cryptocurrencies continue to gain mainstream recognition in many ways.
Chainalysis also mentioned that the funds flowing into "legitimate" services so far this year are at the "highest level" since 2021 (the last peak of the bull market). It pointed out that illegal activity funds have decreased by "19.6%, from $20.9 billion to $16.7 billion, indicating that the growth rate of legitimate activities is outpacing on-chain illegal activities."

These signs suggest that cryptocurrencies will continue to be "adopted globally," which is also reflected in Japan's crypto ecosystem. Overall, Japan's services have a "generally lower exposure to global illegal entities, such as sanctioned entities, dark web markets (DNM), and ransomware services, as most Japanese services primarily target Japanese users."

However, the report clarifies that this does not mean Japan is "completely immune to crypto-related crime," with public reports including Japan's Financial Intelligence Unit (FIU) JAFIC emphasizing that cryptocurrencies pose a "significant money laundering risk." Chainalysis further pointed out that although Japan's contact with international illegal entities may be limited, the country "is not without its own local challenges. Off-chain criminal entities utilizing cryptocurrencies are common but often remain unknown." (Crowdfund Insider)