Cryptocurrencies have long been lauded for being a borderless, decentralized way to transfer cash — and while they’ve emerged as a major speculative asset, fans have often struggled to point to a real-world use case for them.
But thanks to a broad lack of regulation and the ability to carry out transactions via anonymous accounts, crypto have become incredibly popular for a distinctly grim use: funding human trafficking operations, from trapping laborers in compounds and forcing them to work, to prostitution rings.
According to a new report by blockchain intelligence company Chainalysis, crypto flows to suspected human trafficking services grew a shocking 85 percent last year, an alarming trend that underlines how the digital tokens are facilitating an enormous and growing amount of illegal activity.
In other words, crypto may have finally found its killer app.
“This is the continuation of a story of industrialized exploitation,” Chainalysis analyst Tom McLouth told Wired. “The emergence of borderless, low-fee payments has created the opportunity for human trafficking to scale faster.”
Chainalysis found that the total transaction volume of suspect crypto accounts reached hundreds of millions of dollars.
“The dollar amounts significantly understate the human toll of these crimes, where the true cost is measured in lives impacted rather than money transferred,” the company noted.
Human trafficking categories identified by Chainalysis include “international escort” services, “labor placement” agents that facilitate kidnapping and forced labor, prostitution networks, and the sale of child sexual abuse material (CSAM).
Southeast Asia appears to have become a major hub for scam compounds, gambling sites, and money laundering. Chinese-speaking criminal groups were found to advertise their scams in black markets run via Telegram channels. Messages identified by Chainalysis suggest scammers are luring in workers by offering them up to $22,000 per worker.
Scammers across Asia and Africa are luring in their victims via fraudulent job offers, a booming business that pulls in tens of billions of dollars a year.
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