Mexican drug cartels smuggle in $25 billion each year via the use of Bitcoin to finance their operations

It’s unexpected that Bitcoin and other cryptocurrencies have infiltrated the perilous world of drug cartels.

According to law enforcement sources, cryptocurrency is emerging as a new battleground in Latin America’s war on gangs fighting for control of vast illegal markets for sex, drugs, firearms, and people.

In Mexico, many of the country’s most powerful drug gangs have been said to be increasingly using bitcoin to fund their illegal operations.

Two of these heinous groups are the Sinaloa Cartel and the Jalisco New Generation Cartel. According to Insight Crime, the Sinaloa Cartel, commonly referred to as the Western Hemisphere’s biggest and most powerful drug trafficking organisation is an alliance of some of Mexico’s most prominent cartel leaders.

Members of the alliance cooperate collectively to protect themselves, using high-level relationships and controlling components of the federal police and military to maintain an advantage against adversaries.

The Jalisco New Generation Cartel, previously known as Los Mata Zetas, is a semi-militarized Mexican criminal organisation located in Jalisco and commanded by one of the world’s most-wanted drug lords, Nemesio Oseguera Cervantes.

Drug Cartels Use Bitcoin To Avoid Being Spied On

According to the United Nations Office on Drugs and Crime, Mexican cartels launder around $25 billion per year via the use of Bitcoin, the internet, and e-commerce.

According to an International Narcotics Control Board study issued Friday, the Jalisco and Sinaloa cartels are increasingly using tiny online bitcoin transactions to dodge anti-money laundering legislation.

The study added that after splitting drug revenues into little payments to avoid discovery, the cartels use those accounts to acquire a series of small amounts of bitcoin online, obscuring the source of the cash and allowing them to pay accomplices abroad.

Raul Martin del Campo, a spokesperson of the US Drug Enforcement Administration, told AFP in Mexico City: “The INCB is “issued a red alert to governments to reach an agreement and discuss ways to improve regulation of this (cryptocurrency) payment system.”

The charges come less than a week after US President Joe Biden issued an executive order directing the government to investigate the risks and advantages of establishing a central bank digital currency, as well as other cryptocurrency-related issues.

Trafficking in Persons & Bitcoin

In April 2019, Mexican officials arrested Ignacio Santoyo, a suspected human trafficker, in an affluent portion of the Caribbean resort of Playa del Carmen after establishing a connection between him and a prostitution network operating throughout Latin America.

However, officials said that it was not the 2,000 women Santoyo is accused of blackmailing and sexually abusing that ultimately led to his arrest, but the bitcoin he is suspected of using to assist in laundering the profits of his crimes.

The International Narcotics Control Board (INCB) is the United Nations’ autonomous and quasi-judicial organisation charged with overseeing the execution of international drug control accords. In 1968, it was established to carry out the 1961 Single Convention on Narcotic Drugs.

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