TRM Labs Study Identifies Slowdown in Crypto Fentanyl Sales
A recent study from TRM Labs has revealed a significant decrease in the growth of fentanyl sales denominated in cryptocurrency during 2023. The research, which examined over 100 online fentanyl vendors, found that sales only increased by just under 60% in the first three quarters of the year.
The study suggests that the slowdown may be linked to the aggressive actions taken by the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC).
OFAC has imposed sanctions on 82 individuals and entities involved in fentanyl production and distribution in 2023, a considerable increase from previous years. One of the major sanctions targeted a China-based network responsible for manufacturing and distributing fentanyl precursors.
Relationship Between OFAC Sanctions and Sales Decline
TRM Labs’ analysis found a connection between the recent sanctions and a decrease in online fentanyl sales involving cryptocurrency. Sales volumes dipped significantly in April and May following the sanctions, and experienced another drop in October after 28 individuals and entities were designated.
While the decline in crypto-related fentanyl sales does not necessarily mean a reduction in demand, it does indicate that new vendors may emerge to fill the gap. However, these new players will likely face increased pressure from U.S. and international law enforcement agencies.
Hot Take: Decrease in Crypto Fentanyl Sales Due to OFAC Sanctions
The TRM Labs study demonstrates that recent OFAC sanctions have led to a slowdown in crypto-denominated fentanyl sales. With an increase in sanctions and disruptions to supply chains, the decline in sales is attributed to increased risks for those engaging with targeted manufacturers. While the decrease may not correlate to reduced demand, it suggests that new vendors will likely face more scrutiny and pressure from law enforcement agencies.
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