According to a recent report from blockchain analytics firm Elliptic, Dogecoin is increasingly linked to illegal activities. This includes Ponzi schemes, terrorism financing, and child sexual abuse material (CSAM).
According to the report, the meme coin has become increasingly popular as a means of payment. The crypto asset has grown significantly in popularity as a payment method, despite its initial reputation as a joke. The Ukrainian government has even started accepting DOGE donations for its defense against the Russian invasion.
However, it is not only used for good, but has also attracted the attention of bad people. This can be proven by the identification of “millions of dollars worth of Dogecoin transactions related to illegal activities.”
Rising Cases of Terrorism Financing, Child Sexual Abuse Material
As evidence of Dogecoin’s “increasing adoption” for terrorist financing, the report cited a July 2021 seizure order issued by Israel’s National Counter-Terrorism Bureau against 84 crypto addresses. These were believed to be associated with the Hamas militant group. Among the crypto addresses were wallets with $40,235 in DOGE.
The article also referred to a “small and increasing number” of CSAM merchants operating on both the darknet and clearnet who were paid with Dogecoin. While the precise amount of DOGE Elliptic discovered in this case was small — less than $3,000 — analysts have issued a warning. Many feel it illustrates the thirst of criminals to use a wide variety of crypto assets in an attempt to avoid detection.
To be clear, there is currently very little Dogecoin usage within the CSAM group. So far, less than $3,000 in payments has been registered internationally. The fact that this community has joined the DThe adoption trend of ogecoin further illustrates how criminal actors adopt various crypto assets.
Ponzi schemes, thefts and scams are among the most common
Theft, fraud and Ponzi schemes have been found to be by far the main criminal activity affecting DOGE. To date, Elliptic has uncovered more than 50 thefts, fraud, and Ponzi schemes that value Dogecoin at hundreds of millions of dollars.
Dogewallet, a storage option for DOGE users, was once the victim of a hack that resulted in the loss of nearly $14,000 in user funds. Other key examples include the Plus Token Ponzi scheme, which led to the Chinese government seizing more than $20 million in DOGE and an alleged loss of $119 million in DOGE related to a Turkish Ponzi scheme in 2021.
When unable to access conventional funding, far-right extremist groups have also turned to cryptocurrencies such as Dogecoin, Elliptical reported.
The crypto analytics platform listed several far-right news websites, blogs, and video-sharing websites. One such news site, Infowars, has raised over $1,700 in Dogecoin so far. It declares that it “combats globalism and advocates for a pro-human future around the world”.
This post Why a walk in Dogecoin [DOGE] adoption doesn’t tell us the whole story
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