This report has been prepared by Observatoire ARGA and is devoted to a comprehensive analysis of decentralized finance (DeFi) and decentralized autonomous organizations (DAOs) as a new institutional environment in which stable mechanisms for money laundering, concealment of beneficial ownership, and circumvention of traditional financial and sanctions controls are being formed. At the core of the study lies the systemic mismatch between the architecture of decentralized protocols and classical models of legal regulation and liability.

The report demonstrates that DeFi protocols, operating through smart contracts and lacking centralized operators, create a fundamentally different risk configuration compared to traditional financial intermediaries. The absence of a single controlling entity, automated code execution, and global accessibility without jurisdictional anchoring result in AML/CFT and sanctions compliance mechanisms—designed for intermediary-based regulation—becoming institutionally inapplicable or fragmented.

Particular attention is paid to the role of DAOs as a governance structure in which formally distributed responsibility coexists with the de facto concentration of control in the hands of a limited group of participants—developers, infrastructure administrators, and major token holders. The report analyzes international enforcement practice demonstrating the gradual dismantling of the concept of “DAO immunity” and the expansion of liability frameworks to governance participants and key infrastructure nodes.

A substantial portion of the study is devoted to the use of DeFi as infrastructure for the layering stage in classical money laundering models. Typical schemes are examined, including sequential swaps via decentralized exchanges (DEXs), interaction with automated market makers (AMMs), migration between liquidity pools, the use of cross-chain bridges, and mixers. It is shown that such operations generate nonlinear and fragmented transaction graphs in which on-chain data lose independent evidentiary value without access to off-chain information.

Separate sections address mixers and cross-chain infrastructure as key points of regulatory and jurisdictional blindness. The report analyzes sanctions and criminal measures targeting mixers, as well as legal disputes concerning the permissibility of extending sanctions regimes to smart contracts as technological objects. It demonstrates that targeted pressure on infrastructure services and developers reflects attempts to compensate for the absence of direct control mechanisms in a decentralized environment.

The report also examines the use of DeFi in a broader political-economic context, including its role in transnational cyber theft, “state-linked” laundering circuits, and corporate conflicts. It emphasizes that criminal law and sanctions frameworks in such cases often function not only as instruments of crime prevention, but also as tools for asset redistribution and economic pressure.

The concluding section formulates findings on the emergence of a new zone of regulatory blindness in which decentralization ceases to be merely a technological innovation and acquires the function of a systemic instrument for concealment and redistribution of value. The report contains recommendations aimed at developing an international liability model for DeFi and DAOs, strengthening oversight of key infrastructure nodes (on/off-ramps, OTC segments), institutionalizing evidentiary standards for on-chain analysis, and coordinating sanctions and criminal enforcement measures in light of the technological specificities of decentralized protocols.