Mexican and Colombian drug cartels have begun to use bitcoin more often

According to a recent report by the United Nations Office on Drugs and Crime, some known drug cartels of the new generation such as Jalisco and Sinaloa are increasingly using cryptocurrencies in their criminal activities as new digital assets have become a convenient financial tool.

Bitcoin and other altcoins are used for drug trafficking, money- laundering and terrorist financing. Thus, drug profits are divided into small payments, and then the cartels buy bitcoins with them, "hiding the source of money and allowing them to pay partners in other countries of the world." Sinaloa is one of the largest drug trafficking organizations in the world. For decades, the cartel has been run by Joaquin "El Chapo" Guzmán, who is serving a life sentence in a US federal prison. It is worth noting that despite the growing concerns related to crypto crime and money- laundering, fiat currency is still leading in illegal trade and terrorist financing. Earlier this month, the US Department of the Treasury released a report for the past three years, which notes that fiat currency continues to be used much more often in illegal financial transactions than cryptocurrency. DeFi is still considered to be a growing “technology for additional anonymity”. Virtual assets have been used in phishing attacks and ransomware scams. Typically, attackers promise victims profit from the volatility of the cryptocurrency market, force victims to download malware onto digital devices, and then extort payment in cryptocurrency. The report states that the use of cryptocurrencies as a way to launder money, including drug trafficking, is increasing. However, the Treasury Department claims that fiat currency still leads when it comes to the criminal use of money. “The use of virtual assets for money- laundering remains much lower than the use of fiat currency and more traditional methods,” the report says. Blockchain transactions and personal cryptocurrency wallets tend to help people escape the financial control of regulators, but the blockchain is also an open public registry that can be used to track criminal activity.