According to a latest study by Elliptic, the widely used meme cryptocurrency Dogecoin (DOGE) has grown more and more associated with a number of illegal activities including the financing of terrorism, Ponzi schemes, and child sex abuse.
The meme coin made popular by Elon Musk has become a popular choice for nefarious actors to facilitate transactions in the millions, the blockchain analytics company revealed in its report.
A seizure order was issued in July 2021 by Israel’s National Bureau for Counter Terror Financing against 84 crypto addresses that were allegedly linked to the Hamas organization. Dogecoin worth $40,235 was kept in one of those wallets.
The analytics firm also found that a small but expanding number of CSAM vendors outside and on the darknet now accept Bitcoin. Only $3000 worth of Dogecoin were found by Elliptics, which is a small amount.
Dogecoin is accepted on darknets
Dogecoin is also accepted by a number of malware campaigns and darknet markets. While some darknet services no longer accept Dogecoin, Elliptic has identified those that do, including Just-Kill.
In addition to terrorist organizations, far-right extremist groups also seem to be interested in cryptocurrencies, such as Dogecoin.
When they are unable to raise money through conventional channels, these organisations, far-right blogs, news outlets, and video sharing platforms use Dogecoin.
One such website is Infowars. The news website that opposes far-right globalism has raised more than $1,700 in Dogecoin.
This discovery is comparable to those made by the Financial Action Task Force last year about the use of cryptocurrencies by far-right organisations, including Bitcoin and privacy coins.
However, it appears that the most common illegal uses of Dogecoin are fraud, theft, and Ponzi schemes. Elliptic asserts to have found more than 50 instances of criminals withdrawing millions of dollars in Dogecoin.
A common example is the alleged theft of $119 million in Dogecoin last year that was connected to a Turkish Ponzi scheme.
In the $6 billion Plus Token Ponzi scheme in 2020, the Chinese government also seized more than $20 million DOGE.
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