Why Criminal Organizations Are Really Using Cryptocurrency And It's Not About Anonymity

Contrary to the widespread belief that cryptocurrency is primarily attractive to criminals for its anonymity, a new Chainalysis report reveals a more nuanced truth: organized crime groups are using crypto because it’s fast, efficient, and offers seamless global payments. Most of these groups lack the skills—or even the intent—to cover their tracks on the blockchain.

The Real Reason Criminals Are Turning to Crypto

Organized crime has embraced cryptocurrency for one major reason: speed and accessibility. Digital assets allow for instant, borderless transactions, making it easier for criminal enterprises to move money across countries without the red tape and delays tied to traditional banking systems.

Take, for example, Mexican drug cartels, which have been found using crypto to pay Chinese suppliers for fentanyl ingredients. The appeal? Minimal transaction fees and fast settlements. But this isn’t about secrecy, it’s about convenience.

The Myth of Crypto Anonymity

There’s a common misconception that cryptocurrency is untraceable. In reality, unless advanced privacy techniques are used, every blockchain transaction is public and permanent. Blockchain data can be viewed and analyzed by anyone with the right tools, which makes crypto a poor choice for criminals looking to stay hidden.

Still, many criminal groups continue to use popular coins like Bitcoin or stablecoins without obfuscation. They often avoid privacy-focused coins like Monero because of their technical complexity or low liquidity.

Unlike Cybercriminals, Cartels Don’t Cover Their Tracks

Chainalysis points out a striking contrast between traditional crime syndicates and state-sponsored hackers like those from North Korea. While cybercriminals tend to use mixers, tumblers, and privacy coins to hide their trails, most cartel-linked actors and traffickers transact in the open, sometimes even using regulated exchanges that follow KYC/AML compliance.

This lack of sophistication benefits investigators, as it leaves clear paths for on-chain tracking and asset recovery. In one high-profile case, authorities traced and seized nearly all the crypto ransom paid during the Ledger co-founder kidnapping.

Law Enforcement Has a Unique Opportunity

The transparency of blockchain presents a huge opportunity for law enforcement. Since the blockchain is an immutable ledger, investigators can track transactions in real time, mapping out illicit networks that stretch across borders—something nearly impossible with conventional financial systems.

Moreover, the use of centralized exchanges (CEXs) by criminals further aids investigations. These platforms often comply with KYC (Know Your Customer) rules, allowing authorities to link wallet addresses to real-world identities.

However, a major hurdle remains: a lack of expertise. Many enforcement agencies still struggle with blockchain analysis, as crypto hasn’t yet gone fully mainstream in policing strategies.

The Clock Is Ticking

As criminals begin to recognize their vulnerability on public blockchains, they may eventually adopt more advanced obfuscation tactics. That’s why authorities must invest in blockchain training and upgrade investigative capabilities now—before criminal methods evolve.

Mastering crypto forensics could empower law enforcement to not just respond to crime, but prevent it. The key is acting quickly, while criminal actors are still making the mistake of choosing efficiency over anonymity.