U.S. Treasury Targets Crypto Wallets Linked to Illegal Fentanyl Trade – Here's What You Need to Know
The United States Treasury's Office of Foreign Assets Control (OFAC) has sanctioned several cryptocurrency wallets associated with the illegal fentanyl trade.
On Tuesday, the OFAC added a new set of crypto wallets to its specially designated nationals (SDN) list, targeting a drug trafficking network primarily centered in China.
The wallets were used by six entities, including five individuals and one company named Valerian Labs, to facilitate their illicit operations.
In total, the government flagged 17 wallet addresses, spanning Bitcoin (BTC), Ethereum, and Tron networks.
Most of the illicit transactions on Ethereum (ETH) and TRON (TRX) networks were conducted using stablecoins, which are cryptocurrency tokens backed by relatively price-stable fiat currencies like the U.S. dollar.
The wallets associated with the individuals, except for Valerian Labs, were hosted on a centralized crypto exchange, through which they received hundreds of thousands of dollars worth of cryptocurrency.
However, the specific exchange was not disclosed.
In a blog post on the matter, blockchain surveillance firm Chainalysis estimated that these addresses collectively received nearly $3.8 million worth of cryptocurrency, potentially representing significant quantities of drugs trafficked into the United States and other countries.
"The sanctioned entities make up a drug trafficking network centered primarily in China, but also include one Canadian national and two Canadian businesses under that individual’s ownership."
The investigation by Chainalysis revealed that these wallets received funds through a series of small transfers in consistent amounts from personal wallets and other mainstream exchanges.
The pattern of consistent payments indicates
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