As crypto markets enter 2026, one theme has become increasingly clear: Last year was less about speculation and more about infrastructure, regulation, and real-world usage. Across jurisdictions, regulators and institutions have moved from theory to implementation, reshaping how digital assets are supervised and used.
A defining feature of this change has been the rise of stablecoins. While Bitcoin 
BTCUSD continues to dominate crypto market cap, stablecoins now account for more than half of all on-chain trading volumes worldwide. Their growing role in payments, remittances and commerce has placed them firmly at the center of regulatory attention, particularly as governments grapple with risks related to financial stability and non-compliance.
In this week’s episode of Byte-Sized Insight, Cointelegraph explores how these changes have played out in practice, drawing on insights from Matthias Bauer-Langgartner, Head of Policy for Europe at Chainalysis.
Stablecoins are not on the fringes
Bauer-Langgartner said: “2025 was a year of stablecoins.”
He began by pointing out that this is not particularly new, as their dominance has been growing for years. According to Chainalysis data, stablecoins “now clearly dominate the crypto asset landscape with over 50% of trading volumes,” even though Bitcoin retains around half of the total market capitalization.
This growth has made stablecoins attractive for both legitimate and illicit use cases.
“Stablecoins have (also) dominated crypto asset trading volumes for some time now, both in illicit use and also in legitimate use.”
He added that criminals favor stablecoins because they are liquid, globally accessible and avoid volatility. Yet this same structure creates enforcement leverage.
“Centralized stablecoin issuers typically have the ability to freeze or even burn stablecoins,” he said, calling it “an extremely powerful tool to combat financial crime.”
Crypto Crime Goes Geopolitical
Beyond individual scams and hacks, 2025 also marked a shift toward state-linked crypto activity.
Bauer-Langgartner said: “2025 really was, in many, many cases, a record year also for crypto crime. » Chainalysis recorded $154 billion in illicit crypto flows, a 162% year-over-year increase.
Related: Tether’s role in Venezuela and Iran highlights the duality of stablecoins
Much of this growth has been driven by state actors, he said.
“Nation-state actors are facilitating the use of cryptography for illicit activities at a truly professional level.”
In the episode, he also dismantled specific sanctioned stablecoins and state-backed networks used to circumvent sanctions.
Despite the sharp increase, Bauer-Langgartner said illicit activities still represent only a small share of overall usage. “Even with the increase we’ve seen, it’s still less than 1% of overall activity,” he said, highlighting the challenge regulators face as adoption accelerates.
He also highlighted Europe’s ongoing implementation of regulation of crypto-asset markets and how this, along with other global frameworks, is taking shape and creating a more structured industry.
Listen to the full episode on the Cointelegraph Podcasts page, Apple Podcasts or Spotify. And don’t forget to check out the full lineup of other Cointelegraph shows!
