On June 22, Elliptic Connect, a blockchain analytics provider specializing in cryptocurrency-based financial crime prevention, published an investigation showing that Dogecoin (DOGE), Elon Musk’s favorite cryptocurrency, is being used by criminals to commit illicit acts.
According to Elliptic, Dogecoin is being used to finance frauds, scams, Ponzi schemes, and other more serious crimes like terrorism and child sexual abuse material.
Elliptic has identified millions of dollars worth of Dogecoin transactions connected to illicit activity including terrorism financing and vendors of child sexual abuse material (CSAM). https://t.co/a4x5pD1nuC#doge
— elliptic (@elliptic) June 21, 2022
Criminals Use DOGE Instead of BTC and ETH
Per Elliptic’s report, criminals have moved millions of dollars in DOGE through thefts, scams, and Ponzi schemes. These include Plus Token, in which $20 million in DOGE were seized, and another alleged $119 million DOGE theft in China connected to a Turkish Ponzi scheme.
However, although millions of dollars are being moved in Dogecoin, most illicit activities are not as severe as terrorist financing or the purchase of child sexual abuse material —even though these also exist.
For example, for terrorism financing, the estimated value moved with DOGE amounts to just over $40,000, while for child sexual abuse material, the total is less than $3,000. This shows that criminals are using Dogecoin to evade authorities who have focused on other more established cryptocurrencies like Bitcoin, Ethereum, or Monero.
As for the darknet, Dogecoin is accepted in several marketplaces, such as Archetype, which focuses on drug sales. Just-Kill is used as a verifier for stolen credit cards and others that promote illegal buying and selling of weapons and stolen goods.
Elliptic also reported an increase in the use of malware or computer viruses to steal Dogecoin from users’ wallets. However, it noted that the destination address for these funds had received almost $29,000, a minimal figure considering the millions of dollars in cryptocurrencies that have been stolen with similar tools.
No Longer Considered a Meme Coin
A curious fact is that, according to Elliptic, Dogecoin is no longer viewed as a meme currency thanks to the promotion that Elon Musk has made through his social media accounts, recalling that a few days ago, the electric car billionaire once again doubled down on his support for DOGE in the World Economic Forum.
And yet, even if indeed Dogecoin is being used for illicit activities, the reported figures are extremely small when taking into account its total value, which despite the drop, amounts to more than $8,353,034,906 according to CoinMarketCap.