Cryptocurrency Dogecoin is increasingly being connected to illicit activity like terrorism financing and child sex abuse, according to a new study.
Blockchain analytics firm Elliptic, who authored the report, claimed it had found evidence to suggest that the popular meme token was being used by illicit actors as payment for illegal activity.
Dogecoin was accepted as payment by a number of child sex abuse material vendors online, the report alleged.
While the amount of identified Dogecoin payments used by child sex abuse material vendors is relatively low at $3,000 (£2,443) globally, “the fact that the Dogecoin adoption trend has reached this community further demonstrates the appetite for criminal actors to adopt a wide range of cryptoassets in a bid to avoid notice,” Elliptic’s report said.
Last year, Israel’s National Bureau for Counter Terror Financing issued a seizure order against numerous cryptoasset addresses which were believed to be controlled by militant group Hamas, or otherwise used in terror-related activity. Dogecoin addresses were included in this and had received $40,235 (£32,765.37), according to the report.
Elliptic also identified multiple markets on the darknet markets that accept Dogecoin as payment, such as those selling drugs and stolen data.
Far-right extremist groups have also utilized Dogecoin, turning to cryptocurrencies when excluded from traditional methods of finance, Elliptic noted. It found that numerous far-right entities have used Dogecoin to raise funds, including far-right website Infowars, which has so far raised more than $1700 (£1383) in Dogecoin.
Dogecoin has notably been promoted by Elon Musk, the world’s richest man, who said on Sunday he still supports and buys the token.
Dogecoin founders, Billy Markus and Jackson Palmer, have become quite critical of the crypto space since they launched the coin in 2013. In an interview with Australian TV show The Project on Monday, Palmer compared cryptocurrencies to a “house of cards” and said some cards at the bottom have “started to crumble.”
Markus and Palmer did not immediately respond to requests for comment on the report.