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Chinese suppliers of the synthetic opioid fentanyl hold more than $32 million in crypto wallets, mostly from centralized exchanges. This is stated in the Elliptic report.
According to analysts, more than 100 dealers from China offer to purchase precursors for the manufacture of drugs and tablet presses for digital assets.
Some traders offered the company’s experts to buy fentanyl.
“Out of a sample of 141 potential suppliers from China and India, 100 expressed their willingness to supply our researchers with fentanyl precursors and tablet presses, accepting cryptocurrency for payment. All 100 suppliers were Chinese,” Elliptic said.
US Senator Elizabeth Warren drew attention to the issue in June. She stated that the criminals realized the sale of illegal substances in the amount of more than $540 million using digital assets.
“Cryptocurrency is helping to fund the fentanyl trade, and we have the ability to stop it,” the senator said.
Companies with accounts on major exchanges outside of China often act as an intermediary between buyers and suppliers, according to the report.
Basically, drug traffickers use bitcoin and the stablecoin Tether as payment for goods, experts explained.
Analysts note that most of the illegal shipments from China are not sent to the United States, but to Mexico and Germany.
Dealers have a well-established trading scheme, and some even have their own marketplaces.
Sometimes, Chinese vendors advertise drugs on the SoundCloud music service and social media platforms like Facebook, TikTok, Twitter, and Instagram.
The company also noted that the merchants have established supply chains around the world, including in the CIS countries. In Russia, dealers use new darknet marketplaces that have appeared after the closure of Hydra servers.
Recall that in October 2022, a local resident was accused in the United States of laundering more than $5.3 million in proceeds from drug trafficking.
In 2023, the United States government began selling bitcoins confiscated from the Silk Road darknet marketplace. In March, the authorities sold 9861 BTC for $215 million, and in July 9824 BTC (~$300 million at the time of the move) began to move.
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