According to an International Consortium of Investigative Journalists (ICIJ) report, at least $28 billion in crypto tied to illicit activity has flowed through major exchanges including Binance, Coinbase, and OKX.
At least $28 billion in criminal crypto moved through mainstream exchanges like Binance, Coinbase, and OKX, ICIJ investigation reveals.
The investigation uncovered a Sinaloa cartel-linked Binance wallet that received over $700,000, with nearly all funds originating from Coinbase accounts.
This digital money trail represents a sophisticated evolution from the cartels’ traditional cash-stuffed-in-duffel-bags approach.
Think of it as upgrading from smuggling money in truck tires to sending it through financial cyberspace with a few clicks.
Stablecoins, particularly Tether’s USDT, have become the preferred laundering tool.
The Huione Group, connected to human trafficking and scams, sent over $408 million in USDT to Binance accounts in a single year—roughly $1 million daily.
That’s like a criminal enterprise running a fortune 500-sized money laundering operation in plain sight.
Despite Binance operating under compliance monitors following its 2023 plea deal, these transactions continued.
Similarly, OKX received at least $226 million from Huione after its own 2024 guilty plea.
The regulatory whack-a-mole game appears to be struggling against sophisticated criminal networks.
The ICIJ report places these activities within a broader ecosystem involving drug trafficking, fentanyl distribution, and global crime networks utilizing major exchanges.
When Coinbase discovered the Sinaloa cartel connections, it reportedly communicated with authorities, leading to sanctions on the wallet address.
The analysis involved tens of thousands of cryptocurrency transactions across 35 countries, revealing unprecedented details about criminal financial flows.
Regulatory actions have imposed at least $5.8 billion in penalties on crypto firms for compliance failures, but criminal enterprises continue adapting.
The shift to digital currencies has created new challenges for law enforcement as cartels replace bulk cash smuggling with fast, dollar-denominated transfers via stablecoins.
Blockchain analytics firms have flagged many of these suspicious wallets, indicating the illicit flows are visible to those looking closely enough at transaction patterns.
Amid these enforcement challenges, Coinbase has filed FOIA requests seeking to uncover exactly how much the SEC has spent on its cryptocurrency enforcement actions.
The White House has softened its stance on cryptocurrency regulation with the press secretary recently declaring an end to the administration’s war on crypto.
