Feds Ran a Bitcoin-Laundering Sting For Over a Year (theverge.com)

More than 40 alleged dark-web drug dealers have been arrested as part of a sweeping federal effort by the Department of Justice as "the first national undercover operation targeting dark net vendors." The Verge reports: The core of the operation was an online money-laundering business seized by agents from Homeland Security Investigations and operated as a sting for over a year. By offering cash for bitcoin, HSI agents were able to identify specific drug dealers, ultimately tracing more than $20 million in drug-linked cryptocurrency transactions. The hijacked money-laundering service was offered across a number of different marketplaces, with agents claiming at least some presence on AlphaBay, Dream Market, Wall Street, and others.

So far, prosecutions have been launched across 19 states as a result of the operation, seizing more than $3.6 million in cash. The same raids seized large quantities of Schedule IV pharmaceuticals -- including 100,000 tramadol pills and over 24 kilograms of Xanax -- as is typical of trade on dark net markets. Agents also recovered more than 300 models of liquid synthetic opioids and roughly 100 grams of fentanyl. Further investigations are still ongoing.

Comments

Was wondering when this was going to happen

[rsilvergun]

Crypto currencies base value is almost entirely on drugs, money laundering and ransomware payments. Legitimate businesses like Steam got out of it when it got to volatile to consider a currency.

Legalize Marijuana and I suspect you'll see the bottom fall out of Crypto currencies. Heck, legalize all drugs and treat the hard ones (cocaine & heroine) like the medical conditions that they are and that's basically that.

I can't say I'd be sad to see them go. It's a tremendous waste of electricity for not much in return. You're not going to get freedom from Government & Corporation backed fiat currencies out of it. If it ever came to that they'd just move in and take over. Heck, by all accounts Bitcoin's price has been manipulated by a bunch of folks out of China for the last year or two. Meanwhile it's nice to see GPU prices slowly coming back to Earth.

Re:Was wondering when this was going to happen

[thegarbz]

Crypto currencies base value is almost entirely on drugs, money laundering and ransomware payments.

Errr no, not even remotely. Crypto currencies' base value is almost entirely speculation, financial fuckery, and idiots investing in dodgy exchanges.

The only thing real that cryptocurrencies are pegged against is ransomware which don't change depending on the bitcoin / dollar value. Drugs and money laundering on the other hand are pegged against the dollar and the bitcoin transactions make up a small amount of that so they have borderline no influence at all. If drugs and money laundering were the basis for bitcoin the price would be far more stable.

You can see that clearly when bitcoin's price barely blips when a major drug site gets taken down, but spikes wildly when some idiot on wallstreet opens their mouth. Now we also have futures to speculate with further removing the value of some cryptocurrencies from anything tangible.

Re:Ohhh, that sounds like Rassah's alley!

[Zontar The Mindless]

In case anyone else didn't know who Rassah is (emphasis is mine)...

Dmitry Murashchik, who goes under the name Rassah, runs Bitcoin 100, which exists to persuade existing charities to accept donations using virtual cash. In January last year, an anonymous donor gave Rassah's organization a donation worth about 180 BTC. At the time, this was worth about $2,600, but with the cryptocurrency's appreciation since then, it is worth approximately $150,000.

With no way of tracking the money or the donor, Rassah had no choice but to accept it to help finance his fledgling non-profit, which offers charities a $1,000 prize if they begin accepting online donations using bitcoin.

“We received a sizable donation of about 180BTC at around the same time as a few exchanges were hacked and robbed,” Rassah said in an email. “I suspect the money was stolen. Since there was nothing I could do to figure out where the money came from, we ended up keeping it.”

Not only does he want to bribe charities to accept donations in BitCoin, he wants them to accept donations whose provenance he himself admits (a) cannot be shown to be legitimate and (b) is very likely directly connected to criminal activity. No charity with at least the good sense that God granted a goat is going to go for any of that.

Not merely scum, but very stupid scum.

Re:Ohhh, that sounds like Rassah's alley!

[Zontar The Mindless]

Sorry, forgot the linky.

Active pharmaceutical component

[DrYak]

Tramadol is like Ibuprofen++. {...} and used by people that are in actual pain

The only thing in common between tramadol and ibuprofen is that they both releive pain and that's about it.

Ibuporofen is a type of non-steroid anti inflammation drug (NSAID). Basically it's "aspirin++" with its own set of set-backs and advantages (it's hard on the stomach. Can also affect the kidneys)

Tramadol is an opioid, it work on the same pain receptors as morphine and heroin, and has a different set of drawbacks that it share with these substance (risk of addiction. Causes often constipation and can cause urinary globe).

- Because it's addictive, it's much more difficult to obtain a prescription. Some people in actual pain might resort to illegal channel to obtain what they need (whil avoiding a high doctor fee, eg.)

- Because it's addictive, if it's not managed correctly, it can lead to addiction, and some people need to constantly get doses to avoid pain (either the people who got it from above, or people who didn't manage it correctly while prescribed by a doctor). They'll use illegal channel to keep fueling their addiction.

- It's an opioid. Somebody is bound to find some dubious way to use it recreatively. They'll also use illegal channels to obtain it.

The same kind of thinking can be also applied to the other drugs. Xanax contains alprazolam, a type of benzodiazepine - a class of drugs that is used as tranquilizers (against stress, to help sleep, etc.) which is also highly addictive.

Overall, these aren't illegal drugs. They are perfectly normal pharmaceutical component, only very strictly regulated ones.

To me, it looks like a sizeable chunk of the illegal drug market that US gov agencies are fighting isn't only druggies that want to get high (LSD, shrooms, etc.) but also people with medical condition that weren't managed properly and slowly devolved into an addiction.

If the other side of the Atlantic pond didn't have such a joke of a healthcare and social welfare system, maybe lots of these addict would have been able to afford going to the doctor, would have had better managed problem and wouldn't be resorting to illegal channel and fueling the drug market.

Yes, I know, we "evil-euro-communist"...

Re:Active pharmaceutical component

[Hodr]

I was all ready to mark your comment insightful until the end when you claim socialized medicine somehow prevents opiod addiction from prescription meds.

Here's a recent BBC article claiming the exact opposite, that the NHS is creating drug addicts.

https://www.bbc.com/news/uk-en...

So go ahead, pretend this is an American only issue.

No magic pixie dust

[DrYak]

you claim socialized medicine somehow prevents opiod addiction from prescription meds.
So go ahead, pretend this is an American only issue.

I think you might have missed the conditionals I've been using :

maybe lots of these addict would have been able to afford going to the doctor, would have had better managed problem and wouldn't be resorting to illegal channel and fueling the drug market.

Noticed ?

I don't claim that socialized medicine is magic wand that you can wave away prescription meds addiction.

I claim that is possible that maybe, by making medicine more affordable, some potential addicts will get their problem better treated, and this could help avoid these to try instead some botched forms of self-medication that turns into addictions.

i.e.: some of the addict are actually patients that started with chronic pain problems, but couldn't afford to have them correctly handled by a professional. And by correctly, I mean considereing *All the options* to manage pain (see randomly quickly googled ref, still corresponds to the complexity I've learned in my studies). The problems is that all of these solution cost time and money.

https://www.bbc.com/news/uk-england-43304375

From the exact same source (BBC) :
- Why opioids are such an American problem. In addition to the title :

When it comes to taking opioids, the United States has the dubious honour of leading the world.
For every one million Americans, almost 50,000 doses of opioids are taken every day. That's four times the rate in the UK.

and if you look about it, several of the listed problems boil down to "not enough resource in health care" (Pill being better re-imbursed than physiotherapy, US doctors earningn more money from kickbacks than salary, no ressource spent in proper pain-management training, etc.) though some are entirely cultural (population brainwashed by ads into "asking for {brand name} pill", unrealistic age-related expectations, online rating of doctors, ...)

- 'Growing problem' of addiction to prescription drugs probed says :

Public Health England is launching a review into the "growing problem" of prescription drug addiction. {...} PHE wants to avoid a situation like the one in the US, where there's been a massive increase in addiction to opioids.

. (i.e.: BBC and PHE thinks that though UK has a problem, it isn't as bad as US).