European law authorities in Spain and Austria have reportedly seized several cryptocurrency tokens, including Bitcoin, IOTA and Lumen. The coins were discovered after officials raided a drug organization and arrested members of an organized crime group. The operation was carried out by a team of officials including officers from Spanish Garda Civil, Europol and the EU Law Enforcement Agency.
Bitcoin Used for Drug Deals
According to the press release dated June 28, 2018, “The Spanish Guardia Civil and the Austrian Federal Police, supported by Europol have dismantled a criminal network,” authorities seized 800,000 doses of LSD and $2.7 million in cash, three pieces of real estate and ten luxury vehicles.
The organized crime group was reportedly involved in the drug smuggling business since 2014, operating mainly on the darkweb. Their modus operandi involved running operations from Spain and sending packages disguised as legal products to over 100 countries. “Among the substances that were distributed were more than 100 different types of NPS: synthetic cannabinoids, depressants, dissociatives, stimulants such as amphetamines or cathinones, nootropics, psychedelics and synthetic opiates, the latter a grave problem in developed countries like the USA,” said the Europol in its statement.
More than 100 different types of NPS have also been seized by the authorities. Their current market value stands at over $14 million. Eight people of Spanish, Austrian and French nationality were arrested as a result of the raid. Bitcoin being seized by authorities confirms that the digital currency was being used by the arrested group as a means to conceal their identity.
Bitcoin can be pseudonymously sent from one wallet to another without revealing the true identity of any user. The smugglers likely took advantage of this feature to avoid being tracked or exposed. Bitcoin was not the only cryptocurrency to be seized by law enforcement though. IOTA and Lumen tokens were also confiscated, worth around €137,000 and €30,000 respectively
Regulatory Worry over Cryptocurrency Abuse
Regulators and governments across the world have are concerned that cryptocurrencies are increasingly being used to finance malicious acts, terrorism and money laundering. Notably, a significant amount of Bitcoin has also been seized in past drug busts around the world. Recently though, illegal markets have started to lean towards privacy coins such as Monero and Zcash over Bitcoin, simply because they offer guaranteed anonymity and privacy from tracking.
Recently, the US Federal Bureau of Investigation had also seized around 500 BTC after shutting down an illegal operation. However, the government hinted that it will not be auctioning the coins, contrary to how it has handled the situation in the past.
In 2014, the FBI seized 50,000 bitcoin from the the now defunct dark web marketplace Silk Road. At the time of the raid, the seized cryptocurrency was valued at $28.5 million. The US Justice Department managed to auction the coins for around $48 million. Popular cryptocurrency investor Tim Draper was the biggest buyer at the auction, purchasing 30,000 BTC in total. At current market prices, those 50,000 bitcoins would be worth north of $296 million.