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125 Smuggling in India Report 2024-25

Overview

Cryptocurrency has emerged as a potent tool for smuggling syndicates due to its
decentralised, pseudonymous, and borderless nature. DRI has observed a rise in
the use of digital assets for illicit payments and transfer of proceeds of crime, par-
ticularly in narcotics trafficking and gold smuggling cases. Unlike traditional
financial channels, cryptocurrencies enable rapid, hard-to-trace international
transfers, bypassing formal financial oversight. This growing trend poses signifi-
cant challenges to law enforcement agencies, necessitating the adoption of
advanced blockchain forensics, inter-agency intelligence sharing, and specialised
analytical tools to trace illicit flows and to combat associated illicit activities.

Understanding Cryptocurrency

Decentralisation
Runs on distributed ledgers
1 1 (e.g., blockchain), minimiz-
ing central authority depen-
dence.

Security & Pseudonymity
Cryptography secures
transactions and prevents 2 2
fraud as it is operated
with wallet addresses, not
personal identities.

Transparency & Immutability
3 Transactions are recorded on public
ledgers, verifiable by all. They cannot
be altered once recorded, ensuring
provenance and immutability of data.

Accessibility
Enables global, border-
less transactions with
internet access. 4

Key Features of Cryptocurrency

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