The United States has been battling a deadly fentanyl epidemic for years. The raw materials used to make the drug come almost entirely from China. It now appears that these Chinese producers are being paid millions of dollars in crypto for producing the raw materials for fentanyl.
The fentanyl epidemic
Fentanyl is considered the most deadly drug in the US and has been a huge problem for years. In 2022, some died estimated more than 100 thousand people, mainly young people, from a drug overdose. Synthetic opioids such as fentanyl are responsible for the vast majority of these deaths. It now appears that this crisis is partly made possible by crypto transactions. Not a good advertisement for the crypto sector.
As mentioned, almost all raw materials needed to produce fentanyl come from China. A report from Elliptic shows that 90 percent of these Chinese manufacturers accept payments in crypto. The companies mostly ship these raw materials to the United States and Mexico. Much of the fentanyl produced in Mexico in turn ends up north of the border in the United States.
🚨 New Elliptic research exposes how crypto is exploited in the illicit fentanyl supply chain… 1/6https://t.co/yhJO0azVUU
— Elliptic (@elliptic) May 23, 2023
Not a good advertisement for crypto
That crypto plays a major role in financing the deadly fentanyl epidemic in the United States is a major shock. According to the report, crypto payments to Chinese producers actually increased by 450 percent in the past year.
Elliptic estimates that a whopping $27 million was paid in crypto to Chinese manufacturers in the past year. Most of this in the form of bitcoin (BTC). This amount is enough to produce a whopping $54 billion worth of fentanyl.
The research company identified more than 90 Chinese companies that were willing to sell the raw materials, and many are even willing to supply fentanyl, despite the practice being banned in China since 2019. So the link between crypto and the fentanyl epidemic has understandably big implications and won’t do crypto’s reputation any good.