Cryptocurrency Transactions Cited by White House Advisory Said to Used for Fentanyl Drug Purchases
US authorities have expressed a negative perception of a cryptocurrency over the last few months, and the country has since operated with policies designed to keep the crypto industry in check. Many crypto-related businesses and exchange have withdrawn their business from the US as a result of the hostile environment.
Two advisories pertaining to drug purchases in the US came out of the White House, and they make reference to the role of digital assets in the buying and selling of drugs. The advisories are directed towards digital payment platforms and financial institutions, and they state that cryptocurrencies are used in illegal activity involving drugs. These transactions are said to be occurring on the dark web and some cryptocurrencies mentioned in the advisory include Bitcoin, Ethereum, Monero and Bitcoin Cash.
The advisory refers to digital assets as convertible virtual assets and defines them as currencies that can be easily converted into stable fiat currency. This definition places a number of digital assets available on American crypto exchanges in this bracket and crypto holders will be keeping an eye on the activity around the advisory.
One of the drugs specifically mentioned in the advisories is fentanyl which is a Schedule 2 controlled substance in the US. The advisories say that the drug enters the US through China or Mexico. Fentanyl is said to be almost 100 times stronger than morphine.
The advisory got the information about the illicit activities being conducted using cryptocurrency through an analysis of sensitive financial data. It says that drug dealers, manufacturers and consumers make use of online payment platforms that are enabled for digital assets to buy the chemicals used to make drugs or the readily made drugs from China.
Combined Regulatory Effort
Other government agencies and affiliated regulatory authorities have been involved in the putting together of the advisory. These concerned agencies came together to “deal with the fentanyl epidemic” among other drug issues that are plaguing the US.
In this bid to combat the drug issues, the agencies made an effort to look at the financial activity surrounding crypto assets on the suspicion that these currencies are being used to buy and sell drugs.
The advisory report mentions a list of methods used to track and discover activity surrounding illegal drug activity. Some of the methods the combined effort from the American agencies used include looking at the IP addresses used in these transactions and the wallets owned by the people executing the trades.
US Crypto Industry Battle Against Authorities
A few weeks ago, President Donald Trump referred to crypto assets as volatile and carrying no real value. The American President went on to say that digital assets are not backed by anything and strongly hinted that they should be banned from the country.
American congress has also placed a lot of scrutiny on cryptocurrency after the announcement of Facebook’s project Libra. The potential that Libra has to change the way financial systems work has put regulatory authorities on high alert as they try to make sure that the virtual currencies are created within existing financial regulations.