According to a blockchain analysis company, Elliptic, fraudulent, criminal organizations and individuals have been using the meme coin, DOGE.
Globally, DOGE has been accepted as a payment form, according to the report by Elliptic. However, DOGE has been used to carry out illegal activities. In the report, Elliptic states, "While the vast majority of this activity consists of fraud, scams and Ponzi schemes, it also includes the most serious types of crime, including terrorist financing and purveyors of child sexual abuse (CSAM) material."
The primary way, according to the study by Elliptic, whereby Dogecoin is used for fraudulent activities is linked to pyramid schemes, financial fraud, and scams. There are claims by Elliptic that the firm has identified over 50 illicit cases with "hundreds of millions of dollars" being embezzled and stolen worldwide.
One example is the case of the Chinese government seizing Doge worth over $20 million from PlusToken. PlusToken is a fraudulent scheme in China which stole cryptocurrencies worth $6 billion. Another case is the Turkey Ponzi scheme of $120 million in 2021 which DOGE was linked to.
The adoption of Dogecoin by terrorists is increasing, although the meme coin has small financial transactions. Terrorist attacks have been observed to be financed by Dogecoin. In July 2021, a government office in Israel discovered many cryptocurrency addresses linked to Hamas. Interestingly, a number of these addresses had over $40,000 worth of DOGE.
Additionally, it revealed a "small and growing number" of providers involved in child pornography that accept payments in crypto. Although it's just $3000 worth of DOGE that the child porn providers have received, people are skeptical about the token.
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Owing to the exclusion of far-right extremists from the traditional ways of raising funds, they turned to cryptocurrencies, with DOGE being the most used. According to Elliptic, far-right extremist groups include far-right blogs, video sharing sites, and news platforms.
Infowars, one of the far-right news sites, claims the site is "battling globalism and promoting a pro-human future worldwide". So far, the news site has gathered over $1,700 in Dogecoin.
In these past months, Elon Musk, Tesla CEO, has heavily promoted and supported the meme coin. Presently, DOGE is the 10th largest crypto coin in the world, with a market cap of more than $8 billion.