[ad_1]

The Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury has sanctioned crypto wallets allegedly connected to individuals and companies involved in the production of fentanyl.

In an Oct. 3 notice, the U.S. Justice Department announced indictments against several China-based chemical manufacturers as well as many of their employees, who allegedly used crypto transactions as part of an illegal fentanyl precursor distribution scheme. According to the U.S. authorities, the companies “tend to use cryptocurrency transactions to conceal their identities and the location and movement of their funds”, identifying at least 3 individuals who held crypto wallets for payments.

OFAC added wallets for Bitcoin (BTC), Ether (ETH), USD Coin (USDC), Tether (USDT) and Tron (TRX) connected to Chinese nationals and Valerian Labs to its list of Specially Designated Nationals along with companies including Hanhong Pharmaceutical Technology and Hebei Crovell Biotech. According to Deputy Treasury Secretary Wally Adeyemo, the enforcement action was aimed at disrupting an illicit drug network.

‘[W]e have identified and blocked over a dozen virtual currency wallets associated with these actors,” said Adeyemo. “The blocked wallets, which received millions of USD funds over hundreds of deposits, illustrate the scope and scale of the operation targeted today.”

Related: Crypto and psychedelics: Clarifying regulations could help industries grow

Many lawmakers have urged action on cracking down on the distribution of fentanyl in the United States, where the drug was estimated to be responsible for more than 67,000 deaths in 2021. Massachusetts Sen. Elizabeth Warren — an outspoken critic of digital assets — called out potential links between crypto payments and drug trafficking in a May hearing.

The first week in October also marked the 10th year in prison for Ross Ulbricht, the founder of the online marketplace Silk Road. Many criticized the platform for facilitating the drug trade by allowing payments with digital assets, but Ulbricht still has his supporters in the crypto space.

Magazine: US enforcement agencies are turning up the heat on crypto-related crime