AML Violations: What They Are, Who Gets Hit, and How Crypto Projects Fail

When you hear AML violations, rules designed to stop criminals from hiding illegal money through financial systems. Also known as anti-money laundering compliance, these rules are the backbone of legal crypto use—and the reason so many projects die quietly. It’s not about fancy regulations. It’s about who gets blocked, who gets fined, and who loses everything because someone didn’t check the right boxes.

OFAC sanctions, U.S. government actions that freeze assets and ban transactions with specific people, groups, or countries. Also known as financial blacklists, these are the nuclear option in crypto enforcement. When North Korean hackers stole $2.1 billion and the U.S. hit their laundering networks with OFAC, it wasn’t just a warning—it was a death sentence for any exchange or wallet that touched those funds. Same with Myanmar scam networks tied to $10 billion in fraud. Those aren’t abstract risks. They’re real events that wiped out platforms, froze user funds, and turned tokens into worthless files.

Crypto exchange failure, when a platform shuts down because it couldn’t meet legal standards or got hacked after ignoring compliance. Also known as regulated exchange collapse, this happens over and over. Altsbit didn’t just get hacked—it ignored basic AML checks. Blockfinex hides its volume because it can’t prove it’s clean. Libre and DogeSwap fly under the radar because they don’t want regulators looking. And when Brazil caps forex at $10,000 or China bans all trading, it’s not random—it’s AML in action. These aren’t just country rules. They’re global standards that separate real projects from ghosts.

Every post here connects to one truth: if a crypto project doesn’t respect AML violations, it doesn’t survive. The HERA airdrop faded because the team vanished. The SHREW token never launched because no one trusted it. The SWAPP airdrop claims? All scams trying to bypass identity checks. Even the fake Polyient Games DEX? Designed to steal from people who skip KYC. This isn’t about tech. It’s about trust. And trust dies fast when money laundering is involved.

You’ll find real examples here—how Brazil’s rules changed daily trading, how China’s ban left millions with no legal recourse, how U.S. sanctions crushed entire networks. No theory. No fluff. Just what happened, why it mattered, and how to avoid the same fate.