Nikolas Sargeant
Telegram's shutdown of Huione Guarantee, history's largest illicit cryptocurrency marketplace with over $27 billion in transactions, has paradoxically strengthened the underground economy as rival platforms experienced massive volume increases and rapidly absorbed displaced criminal operations. The enforcement action, while removing thousands of channels and accounts, ultimately demonstrated the resilience of decentralized criminal networks operating within encrypted messaging platforms.
Following comprehensive investigation by blockchain analytics firm Elliptic, Telegram banned Huione-linked channels and accounts on May 13, 2025. However, the criminal ecosystem quickly adapted, with successor platform Tudou Guarantee immediately capturing the displaced activity and processing equivalent transaction volumes within weeks of the original shutdown.
Elliptic's ongoing research has identified over 30 highly active guarantee marketplaces operating across Southeast Asia, continuing to facilitate money laundering operations, stolen data trading, and sophisticated "pig butchering" scam infrastructure. These platforms exploit Telegram's encrypted communication capabilities to maintain sophisticated criminal marketplaces that rival legitimate e-commerce sites in their operational complexity.
The $27 billion Huione operation had functioned as a comprehensive criminal ecosystem, offering services ranging from fake documentation and personal data theft to professional money laundering and intimidation services. The platform's influence extended far beyond financial crime, maintaining connections to human trafficking operations disguised as legitimate technology companies throughout Cambodia, Laos, and Myanmar.
Criminal Enterprise Demonstrates Strategic Continuity Planning
Huione's criminal leadership had strategically positioned themselves for potential enforcement action by acquiring a 30% ownership stake in Tudou Guarantee during December 2024. This forward-thinking approach effectively guaranteed operational continuity months before regulatory pressure materialized, enabling seamless migration of hundreds of thousands of criminal users.
The platform's connections to Cambodia's ruling elite and its documented role in laundering proceeds for North Korea's Lazarus Group made it a primary target for U.S. Treasury's Financial Crimes Enforcement Network, which designated the entire Huione Group as a money laundering concern in May 2025.
Tudou's transaction volumes surged from negligible levels to over 300,000 transactions by June 15, demonstrating the criminal network's organizational sophistication. The same merchants who previously operated through Huione immediately established identical operations on Tudou, offering unchanged services including stolen data access, money laundering capabilities, and specialized tools for pig butchering scams targeting Western victims.
Multiple smaller platforms experienced exponential growth as the criminal ecosystem fragmented across diverse platforms. Shuangying marketplace saw user numbers triple from 40,000 to 110,000 transactions, while Fully Light expanded from 20,000 to over 80,000 transactions, according to Elliptic's analysis.
Enforcement Limitations Highlight Systemic Platform Vulnerabilities
Despite Telegram's cooperation in removing thousands of channels and associated accounts, research from Chainalysis and Elliptic confirmed that Huione's core cryptocurrency processing infrastructure remained operational. The platform simply migrated to alternative domains while quietly resuming Telegram operations within weeks of the apparent shutdown.
This operational resilience stems from sophisticated architectural separation between public-facing marketing infrastructure and core financial processing systems. Criminal operations continue functioning even when their most visible components face regulatory disruption, highlighting the inadequacy of surface-level enforcement approaches.
The enforcement action's limited effectiveness becomes particularly evident when examining the broader criminal ecosystem that Huione enabled, including human trafficking operations that force victims into cryptocurrency scam compounds across Southeast Asia. These physical operations, disguised as customer service centers, create hybrid criminal models combining digital financial crime with traditional human trafficking.
The United Nations estimates that Telegram-based criminal activity generates up to $36.5 billion annually through scams, money laundering, and stolen data sales, with these platforms using Tether's USDT stablecoin as their primary exchange medium to maintain dollar-denominated stability while avoiding traditional banking oversight.
While Telegram has begun responding to regulatory pressure by removing certain features and updating content policies, the platform's core encrypted messaging capabilities remain attractive to criminals exploiting legitimate privacy protections. The ongoing challenge for regulators involves addressing criminal abuse without undermining privacy rights that make encrypted platforms valuable for legitimate global users.
