Elizabeth Warren demands end to crypto fentanyl financing

During a Senate hearing on May 31, Elizabeth Warren highlighted the extensive utilization of cryptocurrency in the Chinese fentanyl trade.

Senator Warren, a prominent figure in the Senate Banking Committee, referenced data from research firm Elliptic, which uncovered over 90 Chinese businesses involved in shipping fentanyl precursors, with the majority of them accepting cryptocurrency as payment.

A primary cause of death in the United States

The rising toll of fentanyl-related overdoses in the United States, now the primary cause of death among individuals aged 18-45, has prompted concerns with the U.S. Congressman George F Murphy, releasing an initial press release in February 2022, and several social posts going viral with the same statistic. 

“Unfortunately, that is a mode that some of these precursor manufacturers and illicit drug organizations have used – the receipt of bitcoin payments in wallets, cryptocurrency wallets. The reason why they would find this appealing is the same reason that other financial criminals would find it appealing, which is to say there’s an element of pseudonymity that they seek.”

Elizabeth Rosenberg, U.S. Treasury Department assistant secretary for terrorist financing and financial crimes.

The drug’s manufacturing components, commonly sourced from China, traverse multiple borders before reaching American users of this synthetic opioid, which the Centre for Disease Control and Prevention describes as 50-100 times more potent than morphine.

Senator Warren has proposed the reintroduction of her Digital Asset Anti-Money Laundering Act in the current Congress, suggesting that it could be instrumental in curtailing cryptocurrency payments associated with the fentanyl trade, thus disrupting its financial channels.

Just one day earlier on May 30, the U.S. Treasury Department released a statement indicating that sanctions had been imposed on seven entities and six individuals from China, along with one entity and three individuals from Mexico.

Paving the way for a broader bitcoin ban

Senator Warren’s warning comes following her intention to “build an anti-crypto army” as part of her re-election campaign. 

This move comes amidst concerns that a potential crackdown could serve as a catalyst for a broader ban on bitcoin and other cryptocurrencies.