Drug cartels are now using Bitcoin and crypto for their illicit deals.
According to reports from the UN-backed narcotics agency, International Narcotics Control Board (INCB), they tracked some cartels in Mexico and Colombia.
As per a tweet by the UN, the agency wrote:
“Illicit financial flows linked to drug trafficking have far-reaching negative impacts on societies – from corruption to increased organized crime, violence, poverty & inequality.”
Illicit financial flows linked to drug trafficking have far-reaching negative impacts on societies – from corruption to increased organized crime, violence, poverty & inequality.
More in latest report from the International Narcotics Control Board. https://t.co/TA1yfdSgQ6 #INCB pic.twitter.com/rNWYDx6d7v
— United Nations (@UN) March 10, 2022
The report states that the Mexican cartels, who are among the most powerful in the world, are responsible for laundering $25 billion in illicit funds. The gangs known for extreme violence are reportedly moving towards using cryptocurrencies such as Bitcoin due to the convenience and security that suit them.
Most of these funds are moved around the Mexican monetary system, making the country’s cartels among the richest in the world. With the use of cryptocurrencies, the impact of these groups could become more widespread.
Knowing Their Way Around The Law
Even though the law in Mexico mandates exchanges to report transactions that are more than $2830, the drug cartels seem to have found ways to circumvent such requirements.
Bitcoin and most digital currencies are pseudonymous, transparent, and fast. These are features that the drug rings have found attractive and no doubt responsible for their increasing use of these blockchain-based coins.
Some of the gangs identified to be using bitcoins in their dealings are the Jalisco New Generation Cartel and the Sinaloa Cartel in Mexico.
In an interview with AFP in Mexico, the International Narcotics Control Board (INCB) country representative said that the situation calls for urgent regulatory measures for cryptocurrencies. He urged countries to come together to map out a strategy to combat the menace associated with drug cartels’ increasing affinity to cryptocurrencies.