Like in the legitimate economy, the U.S. dollar is the "lingua franca" of international crime. Despite other currencies offering higher-denomination notes, the dollar's superior liquidity and universal acceptance make the $100 bill the preferred instrument for criminal transactions worldwide.
Despite banks spending vast sums on compliance, the criminal economy's share of global GDP remains unchanged since the 1990s. The regulations are burdensome and expensive but have only managed to prevent the criminal sector from growing *faster* than the overall economy.
Wealthy Chinese individuals evading capital controls provide cash to brokers. This cash is then given to drug cartels, who supply it to Chinese gamblers in places like Vancouver. The complex debt is settled via international trade flows, creating a circular system benefiting both parties.
A flaw in EU tax law allows criminals to claim VAT refunds on goods for which tax was never paid. Because the potential profit is theoretically limitless, criminal gangs are incentivized to collaborate on increasingly complex schemes rather than compete with each other.
Governments earn "seigniorage" by issuing physical currency, which functions as an interest-free loan. For the U.S., the $2.5 trillion in circulation represents a massive, interest-free debt obligation, creating a powerful financial incentive to continue printing large bills despite their use by criminals.
If the U.S. eliminated its $100 bill, criminals would switch to other large notes like the 200 euro. The U.S. would lose its seigniorage profits while the criminal economy continued unabated, creating a standoff where no single nation is willing to act alone.
The focus on suspicious bank transactions misses the bigger picture. Laundering an estimated trillion dollars a year, criminals move value by mis-invoicing goods like tractors or luxury items, a method that is far more difficult to track than financial transfers.
Modern criminals move value across borders using complex trade flows of goods to obscure financial transactions. This mirrors the exact system used by the Medici bank in Renaissance Florence, which used shipments of silk and wool to settle accounts between its European branches without physically moving gold.
While consumer cash transactions plummet, the circulation of large banknotes like the $100 bill is at an all-time high. This "paradox of banknotes" shows that the vast majority of physical currency isn't used for legitimate commerce, but as an untraceable tool for the global criminal economy.
Crypto doesn't replace cash in money laundering; it enhances it. Criminals use physical cash for street-level transactions, then convert it to stablecoins for instantaneous, borderless transfer. This "stacking" combines cash's anonymity with digital speed, making laundering more efficient.