Recent data from TRM Labs, a blockchain analytics firm, indicates a notable slowdown in the sales of fentanyl, a potent opioid linked to increasing addiction and overdose rates.
Shifting trends in the opioid market
The firm’s press release revealed a downward trend in the revenue streams of darknet drug dealers specializing in fentanyl and its precursors. According to their extensive tracking of over 100 known vendors, there has been a significant decline in cryptocurrency inflows to addresses associated with these vendors throughout 2023.
In January, these vendors reportedly received nearly $2 million in crypto, but by October, this figure had fallen below $1 million. Although the illegal trade of fentanyl is still growing in year-to-year terms, the pace of this growth has slowed considerably. Since 2019, fentanyl-related money flows tracked by TRM have been increasing by an average of 155% annually. However, the growth rate in 2023 dropped to just 60%.
Impact of U.S. government’s interventions
This downturn in the fentanyl market is believed to be a direct consequence of the U.S. government’s intensified crackdown on fentanyl vendors. In 2023, the U.S. Treasury’s Office of Foreign Assets Control (OFAC) sanctioned 82 individuals for their involvement in the fentanyl trade. This is a significant increase compared to previous years, with only 17 people sanctioned in 2022, 15 in 2021, seven in 2020, and five in 2019.
Among the latest sanctions are those targeting a network of Chinese manufacturers of fentanyl and its precursors, as well as actions against the Mexico-based Sinaloa cartel. In a notable move, the cartel reportedly banned the production and trafficking of illegal opioids in areas under its control following these sanctions. Additionally, the Department of Justice achieved a significant milestone in October by seizing large quantities of fentanyl precursors shipped to the U.S. from China.
This concerted effort by U.S. agencies appears to be yielding results, as indicated by the declining inflows to fentanyl vendors. The reduction in the financial transactions associated with the fentanyl trade is a positive sign in the fight against the opioid crisis, but it also highlights the ongoing challenge of curbing the spread of this dangerous drug. As the U.S. continues to battle the opioid epidemic, these findings underscore the importance of persistent and comprehensive strategies in disrupting illegal drug markets.
