As the cryptocurrency industry surges deeper into the financial mainstream, a paradox has emerged at the heart of US regulatory policy. While digital asset platforms now move trillions of dollars annually and market participation widens among retail and institutional investors alike, the federal workforce tasked with policing anti-money laundering (AML) safeguards in the sector has sharply declined. For observers and analysts in countries like Bangladesh-where policymakers closely monitor US financial governance trends-the implications are both immediate and systemic.

According to data obtained by the International Consortium of Investigative Journalists (ICIJ), the number of Internal Revenue Service (IRS) personnel assigned to examine AML compliance at cryptocurrency exchanges and other money services businesses (MSBs) fell to 139 in 2025, a 33 percent drop from 208 in 2024. This marks the lowest staffing level since at least 2017.

The affected office operates within the Internal Revenue Service and is responsible for supervising AML compliance among nonbank financial institutions, including crypto exchanges classified under US law as MSBs. These entities share regulatory categorization with traditional remittance providers such as Western Union, though the scale and technological sophistication of crypto platforms now rival-and in some cases exceed-mid-sized banking institutions.

The reduction in examiner staffing comes at a time when cryptocurrency exchanges are expanding product offerings, increasing transaction throughput, and deepening integration with legacy financial systems. Stablecoins, decentralized finance (DeFi) applications, tokenized securities, and cross-border payment rails have amplified operational complexity. From a compliance standpoint, this multiplies the vectors through which illicit financial flows can move.

Industry specialists note that AML examinations are labor-intensive. They require forensic transaction analysis, customer due diligence audits, suspicious activity reporting assessments, and reviews of internal controls and governance frameworks. In 2021, then-IRS Commissioner Charles Rettig informed Congress that the agency required additional personnel and funding to supervise the “rapidly evolving and expanding” cryptocurrency industry. At that time, 193 agents were assigned to AML oversight within the MSB category.

However, after Congress allocated tens of billions in supplemental IRS funding in 2022 for modernization and staffing expansion, subsequent policy reversals halted much of that growth. Under the........

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