The Treasurer’s Office Released a Digital Assets Report 

TLDR

• As required by the GENIUS Act, the US Treasury has completed and released a digital assets report on crime occurring in the space right now and how the government can fight it.
• The top of the list? Investment scams, pig butchering, and The Lazarus Group. 

The US Department of the Treasury has published a detailed digital assets report on how criminals are misusing our favorite tokens. And more importantly, what’s being done about it. 

It’s dense reading, so we’ve broken it down into plain English. Here’s what you actually need to know. Let’s get after it.

What Is This Digital Assets Report, and Why Should You Care?

The digital assets report was required by the GENIUS Act, which President Trump signed into law on July 18, 2025. Part of that law tasked the Treasury Department with investigating how financial institutions can use cutting-edge technology to detect and stop crypto-related crime.

The result? A 32-page report covering everything from AI-powered fraud detection to the murky world of crypto mixers. If you’re new to crypto and wondering whether it’s safe, this report gives you a pretty honest look at the risks — and the solutions. 

We highly encourage everyone to read the report. There was some really good information and even a couple of surprises we didn’t see coming.

How Big Is the Problem, Really?

The report doesn’t sugarcoat the numbers.

In 2024 alone, victims reported over $9 billion in losses from digital asset-related fraud to the FBI’s Internet Crime Complaint Center (IC3). Of that, $5.8 billion came specifically from digital asset investment scams — a 47% jump from the previous year.

These aren’t faceless statistics. The report describes how scammers often kick things off with a friendly text or social media message, sometimes even pretending to have the wrong number. 

Before long, victims are being guided into fake investment platforms. It’s a tactic known as pig butchering, and it’s run by organized crime groups.

Then there’s North Korea. They have built an entire operation around stealing crypto. In February 2025, North Korean hackers pulled off the largest digital asset heist in history, stealing $1.5 billion from a single crypto platform. Between January 2024 and September 2025, the DPRK stole at least $2.8 billion in digital assets. 

Ransomware is also a growing issue. Criminal groups lock victims out of their own systems and demand payment in crypto. Ransomware payments hit an all-time high of $1.1 billion in 2023, but fell to around $734 million in 2024 due to increased law enforcement pressure.

How Do Criminals Cover Their Tracks?

One of the sneakiest tools in a crypto criminal’s playbook is something called a mixer. These services blend transactions from multiple users, making it incredibly difficult to trace the money’s origin.

The report explains that mixers work by pooling digital assets, splitting them into smaller amounts, or restructuring transactions entirely to hide the origin of funds. 

North Korean hackers, in particular, are described as highly skilled at running stolen crypto through multiple mixers, swapping tokens, and bouncing assets across different blockchains before eventually cashing out.

It’s worth noting that not everyone who uses mixers is a criminal. And this is one of the sections that caught us by surprise. The report admitted that some people simply want financial privacy to keep their personal spending habits off public blockchains and that mixer use, in and of itself, isn’t a criminal activity.

The Tech Used to Fight Back

The digital assets report from The Treasury outlines four key technologies that financial institutions are using or exploring to detect and prevent crypto crime.

Artificial Intelligence

AI is being used by banks and crypto platforms to spot suspicious activity. More advanced AI tools, including large language models (LLMs), are helping compliance teams review fraud cases faster and even draft official suspicious activity reports.

On the flip side, criminals are also using AI to create deepfakes to bypass identity checks at financial institutions. It’s an arms race, and both sides are actively competing.

Digital Identity

Remember when you had to upload a photo of your ID to a crypto exchange to verify your account? That’s digital identity verification in action. 

The report highlights a push toward smarter, more secure versions of this process — like mobile driver’s licenses and zero-knowledge proofs (another one that caught us by surprise), which let you prove who you are without handing over a pile of personal data.

Blockchain Analytics

Here’s a fun fact about crypto that surprises many newcomers: most transactions are public. Every transaction on a blockchain, such as Bitcoin or Ethereum, is recorded in a public ledger. How? Because that’s all a blockchain really is at its core. And investigators can trace the source and destination of funds.

Blockchain analytics tools track transaction patterns, flag suspicious behavior, and even identify when someone is trying to “peel” funds through a chain of transactions to hide their trail. Law enforcement and financial institutions are already using these tools, though there’s still room for standardization.

APIs (Application Programming Interfaces)

APIs are the pipes that connect different software systems. In the context of crypto compliance, they allow banks, exchanges, and compliance tools to share information in real time. So a suspicious transaction can be flagged before settlement.

The challenge is that not all institutions are set up to use them, and smaller companies often lack the technical resources to integrate them properly.

What’s the Government Planning to Do?

The Treasury report comes with a list of potential action items. Here’s the short version with our:

Sure, Ok

• Promoting AI adoption for fraud detection, with guidance to help financial institutions use it confidently
• Issuing clearer rules around digital identity tools so institutions know how to use them without running into regulatory trouble
• Improving blockchain analytics standards so different platforms can work together and share threat intelligence more effectively

Hard Pass

• Exploring a “hold law” that would let institutions temporarily freeze suspicious crypto assets during an investigation, similar to how banks can flag a suspicious wire transfer
• Working with Congress to bring decentralized finance (DeFi) platforms into the regulatory fold, with rules tailored to how those platforms actually work 

What the Treasury’s Digital Assets Report Means for New Crypto Users

If you’re just getting started with crypto, here’s the honest takeaway: yes, there are risks. There always will be. Scammers are sophisticated, and the space moves fast. But regulators are catching up, and the technology being built to protect users is genuinely impressive.

The best thing you can do as a beginner is to stick to reputable, regulated platforms with proper identity verification, transaction monitoring, and clear security practices. If a platform skips those steps — or makes it a little too easy to stay anonymous — that’s a red flag worth paying attention to, at the very least.

Crypto is getting more structured, more transparent, and more secure every year. Understanding the risks is the first step to navigating them confidently.

The Treasury’s digital assets report shows that the US government takes crypto crime seriously and is deploying real resources to fight it. For regular retail users like all of us, that’s good news. Stay safe out there, guys.