Mexican drug cartels are apparently increasingly turning to cryptocurrencies as a means of payment in production processes for the synthetic opioid fentanyl. This is according to a recent report by FinCEN (Financial Crimes Enforcement Network; a U.S. federal financial crime authority). Specifically, it concerns the procurement of raw materials and equipment, which the cartels allegedly obtain mainly from suppliers from the People's Republic of China.

The most popular payment methods are Bitcoin (BTC), Ethereum (ETH), Tether (USDT) and the privacy coin Monero (XMR). Transactions are often split to circumvent money laundering regulations.

According to a study by TRM Labs, 97 percent of China's 120 providers offer payments in crypto. The number of transactions has doubled again compared to 2023.

In 2023, dealers took in nearly US$26 million. The money often flowed directly or through money brokers into the portfolios of Chinese partners, the report said.

There has been a fentanyl crisis in the US for years. According to FinCEN, more than 100,000 Americans died of overdoses last year, including more than 74,000 deaths from synthetic opioids such as fentanyl.

The drugs are often diluted with other substances such as xylazine. A dose as low as two milligrams can kill an adult.

In response to the escalating epidemic, the U.S. and China announced in 2023 that they would strengthen bilateral cooperation to combat drug trafficking. This includes, for example, transnational laws designed primarily to restrict trade in so-called "precursor chemicals."

The cooperation has already had its first successes. In October, for example, the US blocked several portfolios of Chinese drug smugglers. Read more here.