Fentanyl has become America’s drug boogeyman.

It’s everywhere. According to your Uncle Mark, it got here because of our weak borders. According to your mom, they’re dusting weed with it at California dispensaries.

But has crypto gotten involved with the deadly drug ruining bachelor parties everywhere?

We’re here to investigate the ugly truth and give crypto an intervention before somebody gets killed.

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☕️ UK Rejects Proposed Crypto Regulation 🪙 💂

Despite movements to regulate crypto trading like gambling, the British government has rejected the proposal.

To be clear: this isn’t the end of the road for crypto in the U.K. Lawmakers feel that the existing guidelines for crypto are more effective than those proposed.

But representatives from the Treasury firmly disagree with this ruling, according to a response published on the U.K.’s parliament website on July 19.

“A system of gambling regulation, in isolation, would be unlikely to address these risk factors” such as the commingling of customer funds or another FTX-style disaster, the response read.

Ultimately, this is a win for British crypto, since the government has decided to ignore these concerns and keep British guidelines in accordance with those set by other nations in the G20 summit.

It’s a win for crypto, but a loss for British manufacturers with warehouses full of BTC-themed poker chips that will never be put to use.

☕️ Kuwait Bans Crypto Payments 🪙 ✖

The nation of Kuwait has enacted a moratorium on crypto, banning crypto payments and transactions in an effort to reduce money laundering.

Kuwait hasn’t just banned retail crypto but instituted a prohibition against all forms of digital asset mining.

This decision comes from Kuwait’s Capital Markets Authority, which claims it’s acting under recommendations from the Financial Action Task Force, a global agency dedicated to preventing money laundering.

Will the nation head forever into a dark, crypto-less future? Or will crypto just have to Ku-wait it out?

☕️ Congressman Criticizes Gensler ❌ 👴

Congressman Ritchie Torres (D - NY) thinks Gary Gensler is trying to sabotage crypto.

And Torres recently repeated his “overzealous traffic cop” metaphor at Christie’s Auction House Art + Tech Summit. Torres went on to say: “if you’re going to accuse me of speeding, you want to tell me the speeding limit,” according to a Decrypt report.

This isn’t the first time that Torres has spoken out against Gensler. Torres penned a letter in December of 2022 calling for an investigation into Gensler and stating that Gensler was “singularly responsible for the regulatory failures surrounding the collapse of FTX.”

Gensler has insisted that these claims are baseless, but continues to twirl his mustache and tie cold wallets to train tracks.

Spilling the Beans

Mexican Standoff: Crypto vs. Fentanyl?! 🪙 💊

Part of the dream of decentralization is privacy.

While we appreciate our bank shutting off our debit card when we buy gas on a road trip, sometimes you want to buy something or send funds without Uncle Sam looking over your shoulder.

As rights, privacy and security are just as inalienable as freedom of speech or ordering a Slurpee the size of a small child.

But privacy is a double-edged blade. Naturally, everyone wants their finances safe from government overreach, but sometimes people want to be left alone, so they can do truly awful things.

The programmers and innovators behind crypto have worked countless hours to get the space to the state it exists in today.

But like how Albert Einstein’s groundbreaking work on atomic theory established the building blocks that would lead to the nuclear bomb, sometimes the road to hell is paved with good intentions.

That’s why it’s sad (but not surprising) that crypto’s ideal would be twisted for evil goals.

The FBI is currently tracing crypto transactions linked to the sale of fentanyl.

How did it happen? Easy: because crypto’s anonymous, decentralized nature has made it limitlessly appealing to criminal enterprises, such as the Mexican cartels.

The Department of Homeland Security has had difficult time tracing or stopping the flow of fentanyl because of the drug’s international supply chain.

Fentanyl is primarily produced in China, then shipped to Mexico where it’s processed and distributed by drug cartels.

And a frighteningly large amount of that fentanyl finds its way into the U.S. Under policy from the Biden Administration, the DHS has ramped up its efforts to stop the drug at the border.

In the first two months under the new policy, the DHS seized 10,000 pounds of fentanyl at the border. Though presumably, that’s only a fraction of the quantity being distributed in the U.S.

But like any good detective (or the events of “Chinatown”) will tell you, to get to the big players, you have to follow the money.

And that’s exactly what the Feds are doing, by tracing crypto transactions used to buy precursor chemicals, red flags for the production of fentanyl.

By looking at individual criminal crypto users, the feds hope to stop fentanyl production before it starts.

The Department of Homeland Security “is seeking to hold individuals accountable, seizing their property and also interdicting and interrupting their financial flow.” Said Homeland Security Secretary Alejandro Mayorkas in an interview with NBC.

Additionally, the DHS will deal directly with fentanyl manufacturers in China, where the drug is a controlled substance.

“We’re hoping that the negotiations that we are commencing with China’s representatives will actually create some space for us to address with our Chinese counterparts the scourge of fentanyl precursors,” Mayorkas continued.

This is one of those rare cases where we have to root for the feds.

We like to have a good time here at Coffee & Crypto, but we’ll be the first crypto newsletter to bravely, boldly come out as anti-fentanyl.

We’d like to continue on the road toward decentralization without having to worry about decriminalization.

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Meme of the Day

Yep, that’s the face of someone ripping 10x’s on memecoins. 📈

Crypto 101

Financial Action Task Force: This international agency is headquartered in Paris and is dedicated to fighting money laundering and terrorist financing around the globe.

Though it’s not explicitly anti-crypto, the misuse of crypto has certainly become to both money laundering and funding terrorism. In response, the FATF has issued a series of guidelines for crypto-implementation.

Sometimes the interpretation of those guidelines can lead to draconian crypto regulation, or like in Kuwait, the banning of crypto entirely.

The Last Sip

Naturally, we were saddened to learn that crypto is being used by Mexican cartels for fentanyl distribution. To cheer ourselves up, we thought of some fun and lighthearted ways that crime syndicates could use crypto.

• The Yakuza: Laser tattoo removal! Just twelve sessions and you can get rid of that dragon spanning the length of your torso.

• Skinheads: Sunscreen for their bald heads!

• The Mafia: New tablecloths for the restaurant they launder money through, and maybe some breadcrumbs for Mama’s famous meatballs!

Stay Caffeinated,

Coffee & Crypto Team

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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.