A recent investigation has put on the table the relationship between several Chinese chemical companies and their billing in cryptocurrencies in exchange for supplying drug cartels with ingredients to manufacture fentanyl.
Elliptic, a blockchain analysis company, has exposed the big cover of some chemical companies in China. As they explain, these have been receiving cryptocurrency payments in exchange for supplying fentanyl precursors to drug cartels abroaddespite Beijing’s ban.
For those unaware, fentanyl is a powerful synthetic opioid pain reliever—it can be 50 times stronger than heroin—used primarily as a medication to treat severe pain. It is a highly controlled substance in the world due to its addictive potential and risk of overdose.
Since cryptocurrencies can offer a degree of anonymity, some are using them for illicit activities, such as drug trafficking. Elliptic researchers spoke to more than 90 Chinese companies and 90% of these offered payments in cryptocurrencies, while 17 companies were willing to supply the product.
Chemical suppliers received more than $27 million in cryptocurrency, which is enough to buy fentanyl precursors for pills with a street value of $54 billion.
A sweet deal for the drug cartels
The Elliptic report notes that the millions of dollars in precursor sales it tracked on blockchains likely they would be enough to make enough fentanyl to—if distributed efficiently—kill every person on earth.
The big problem, as it has been demonstrated before, is that these companies do not hide in the Deep Web, but rather they do it in front of the public and they largely accept payments in Bitcoin and Tether.
“The amount of crypto that Chinese companies accept for the materials that are used to make these narcotics is underestimated”says Tom Robinson, co-founder of Elliptic and leader of its research team.
This company has also pointed out that various companies advertised fentanyl precursors as their best-selling product, in some cases. “If a company in China wants to accept crypto payments, no one can stop that from happening“, they explain.
However, this discovery does set the stage for pressure on cryptocurrency exchanges to cut off the accounts of the fentanyl precursor sellers that Elliptic has identified. “Definitely, those services have a role to clamp down on this.”they add.