Blockchain analytics startup Elliptic discovered that Chinese companies selling fentanyl precursors take large sums of cryptocurrency payments, primarily in bitcoin (BTC) and tether (USDT).
This information underscores the difficulties law enforcement has in the digital era in preventing the use of cryptocurrency in illegal transactions.
According to the firm, over 90% of the Chinese enterprises polled by Elliptic that deal in fentanyl precursors accept cryptocurrencies as payment. Some of these businesses also provide the ingredients to make other synthetic opioids, such as amphetamines and methamphetamines.
There has been a dramatic increase in the number of transactions involving these businesses, with over $27 million in cryptocurrency sent to wallets connected to chemical suppliers. Money like this might buy the fentanyl precursors needed to make tablets with a $54 billion street value.
Bitcoin payments comprised 66% of the total, with tether transactions on the Tron network making up 21%. In addition, 13% of all payments were made using tether transfers on the Ethereum network, whereas just 1% was done via any other cryptocurrency.
Elliptic has uncovered these illegal endeavors and informed cryptocurrency exchanges of the participation of specific cryptocurrency wallets. The goal is to increase transparency and safeguard the bitcoin market against money laundering.
In China, fentanyl precursors are often purchased using bitcoin, highlighting the persistent difficulty of stopping illegal activity online.