From speculations about its intrinsic value to theories about it being the choice of payment method for criminals, cryptocurrency is having a painful time retaining a clean name. The question is, how much of the speculation is true and how much illegal activity is financed through cryptocurrency?
One of the common accusations is that cryptocurrency perpetuates the sales of illegal drugs online. However, it is notable that most of the illegal activities were being held in the dark web. The dark web is a part of the internet that is accessible via specialized network software that allows users to navigate anonymously while their activity is largely untraceable, and it has been in existence even before the born of crypto.
The University of Technology Sydney report estimates that around 46% of illegal activity per year is using Bitcoin. Besides, the report found that Bitcoin is the most commonly used cryptocurrency for purchasing drugs on the dark web. In 2019, Global Drugs Survey analyzed an all-time high of 27.1% of surveyed drug users obtained illegal substances for the first time via the dark web in the last 12 months, which increased from 19.9% the previous year.
The nature of cryptocurrency that is immutable and decentralized help extending the rate of cyber crimes online, especially in the selling of illicit drugs in the dark web. The usage of cryptocurrency that is almost untraceable is making it the choice of criminals. Professor Talis Putnins, co-author of an influential University of Technology Sydney claimed that cryptocurrencies have had a big impact on the way drugs are purchased.
“Cryptocurrencies have fundamentally transformed the way illegal drugs are bought and sold, shifting much of the activity from a cash-based, physical ‘on the street’ market to an online marketplace.
Despite Bitcoin proven to be used extensively in illegal activity, some argue that the blockchain actually makes it easier for law enforcement to detect illegal activity, despite the currency’s anonymity. This is due to the technology in Bitcoin that allows linkage of individual transactions to the IP address of the sender. Unfortunately, the accuracy of the algorithms remains unsure.
According to a research conducted by Sean Foley, Jonathan R. Karlsen and Tālis J. Putniņš, approximately a quarter of cryptocurrency users and about half of transactions are associated with illegal activity, amounting to 24 million users with total revenue of around $72 billion per year in recent times.
Apparently, there are various articles and researchers made in regards of knowing the widespread of cryptocurrency usage in illegal drug sales. Not only used for buying drugs but, digital currency is apparently a tool for purchasing weapons as well as hitmen in the darknet. However, the ease and convenience of conducting illegal purchasing and activities online does extend to cryptocurrency, but just because there is a tool to do it with, doesn’t mean that the tool is the enemy.
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Nurul is an English Language graduate who is highly passionate on writing, she literally breathes on it. An avid reader and a critical thinker, she covers on blockchain news during day and weeps at sad novels at night.