TRON's Dark Underbelly: Network Facilitates 45% of Illicit Crypto Transactions

According to a recent study by TRM Labs, TRON hosted 45% of all illicit cryptocurrency volume in 2023, an increase from 41% in 2022. The stablecoin Tether (USDT) accounted for the majority of this illicit volume, with over $19 billion in funds being laundered through TRON. The network has also become a preferred platform for North Korean hackers, who exchange stolen funds for USDT and then convert them to fiat currency through OTC brokers.

TRON's Dark Shadow: A Hub for Illicit Crypto Transactions

A bombshell report by blockchain forensics firm TRM Labs has exposed a startling truth: TRON, the blockchain network founded by Chinese entrepreneur Justin Sun, accounted for a staggering 45% of all illicit crypto transactions in 2023. This figure represents a concerning increase from 41% in the previous year, far eclipsing Ethereum (24%) and Bitcoin (18%) in terms of illicit activity.

Tether's Dubious Dominance

Tether (USDT), the so-called "stablecoin," has emerged as the currency of choice for illicit transactions, according to TRM Labs. With over $19 billion in illicit funds, USDT dwarfs the $428.9 million in illicit activity associated with USD Coin (USDC), another stablecoin.

"Among those terror financing campaigns that continued to accept cryptocurrency, the number of unique TRON addresses that received Tether (USDT) rose by 125%," the report states.

A Haven for North Korean Hackers

TRON has also become a preferred playground for hackers affiliated with North Korea, who frequently launder stolen funds through the network, primarily in the form of USDT. These ill-gotten gains are then converted into fiat currency through over-the-counter (OTC) brokers, providing a lifeline for the rogue state.

Decline in Hacked and Sanctioned Funds

Despite these alarming findings, TRM Labs notes a positive trend: a decline in the volumes of hacked and sanctions-exposed funds. This decrease is attributed to increased pressure from governments and law enforcement agencies worldwide, who are cracking down on illicit crypto transactions.

Tether's Commitment to Compliance

In response to the report, Tether has reaffirmed its commitment to combating terrorism and adhering to anti-money laundering (AML) regulations. In a recent letter, Tether outlined its robust KYC procedures and collaboration with US law enforcement agencies, leading to the freezing of illicit crypto wallets.

TRON's Silent Response

As of press time, TRON developers have yet to publicly comment on the TRM Labs findings, leaving many to question their commitment to combating illicit activities on their platform.

Conclusion

The findings of the TRM Labs report paint a disturbing picture: TRON has become a major hub for illicit crypto transactions, potentially fueling terrorism and other nefarious activities. The overwhelming dominance of Tether in this illicit ecosystem raises serious concerns about its role in facilitating such transactions. It remains to be seen whether TRON and Tether will take meaningful steps to address these issues and safeguard the integrity of the crypto industry.