World Bank Aid Diverts 2 to 6 Cents per Dollar to Bitcoin

A document from the National Bureau of Economic Research reveals that the arrival of World Bank aid in developing countries leads to a significant increase in Bitcoin activity. The study analyzes $238 billion in disbursements between 2018 and 2024, showing a 137% surge in anonymous transaction volume in the months following the arrival of aid. Researchers estimate that between $1.7 billion and $4.4 billion, or 2 to 6 cents per dollar of aid, are diverted to cryptocurrency. The most affected sectors include transportation, water and sanitation, social protection, and governance. Funds primarily enter through anonymous wallets, and mixers are gaining popularity. While blockchain facilitates diversion, its transparency also allows for transaction tracing. The authors recommend increased monitoring during aid disbursements. The study only covers Bitcoin and cannot identify the actors behind anonymous wallets.

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