Cryptocurrencies are increasingly recognized by drug traffickers as a fast, pseudonymous, cross-border means of value transactions, according to experts at Chainalysis.
According to a study published by Chainalysis, a blockchain data analysis company, on Tuesday (12), the drug cartels in Mexico and Colombia are using cryptocurrencies for illicit transactions, as do the traffickers who traffic cocaine from South America, throughout Europe and the Balkans.
Additionally, the “Human Trafficking 2021” report published on the US government website noted that authorities have noted that human trafficking networks are increasingly using cryptocurrencies to launder the proceeds of their crimes.
Drug cartels using cryptocurrencies?
The preferred currency of criminals has always been and continues to be cash, there is not so much volatility, there is no record of each transaction and therefore it can change hands easily and anonymously.
However, a drop in physical cash seizures from $741 million to $234 million from 2011 to 2018, primarily from Colombian and Mexican cartels, suggests that criminals may be improving their ability to evade detection and finding other alternatives to move their assets. money, suggests Chainalysis.
As evidence of this on the blockchain, the company brought to the report a case where its chair monitoring tool detected two suspicious groups with transactions linked to Hydra Marketplace, the largest darknet marketplace, which was recently shut down by German authorities.
“Suspicious groups came to the investigator’s attention as they attempted to identify groups with travel movements that reflected a common international cocaine trafficking route,” the company said.
Two drug dealers move money from Hydra and use centralized exchange to launder the money.
“On this long-standing route, cocaine emanates from South America to Western Europe before being transported through the Balkans to Eastern Europe.
Chainalysis intelligence indicates that the two suspected groups may be involved in cocaine trafficking of a similar type, with the only difference being that the ultimate buyers of these drugs were on the Internet.
The funds of the first [traficante] they traveled from Turkey to Serbia and Bulgaria, while the second traveled through Mexico to Spain and Russia. In total, from 2019 to 2022, the suspects sent more than $13 million worth of bitcoin to each other and collected $29 million from Hydra sales. Since then, $21 million has been sent to two centralized washing exchanges.”
Previously, Chainalysis claimed that in 2021, cryptocurrency crimes reached $14 billion, but they only represent 0.15% of the total transactions. It is worth noting that the company sells software related to blockchain investigation and works together with authorities on various investigations around the world.