Paedophiles are using the digital currency bitcoin to buy child sexual abuse images online, a British internet watchdog has found.
In its annual report for 2014, the Internet Watch Foundation said a number of the "most prolific commercial" child sexual abuse websites started accepting the currency as a payment for images last year.
Some 37 websites selling child sex abuse images for bitcoins were reported to the regulator between January and April last year.
Illegal content was being sold in folders on legitimate websites which had been hacked and the URLs were distributed via spam emails, the watchdog said.
Bitcoin is a virtual currency that enables people to pay for goods and services from their computer or mobile device independent of any bank or central authority and is accepted by a wide range of retailers.
Users can generate bitcoins by signing up and creating an online wallet for themselves and then carrying out transactions directly with others who use the service. It has its own value and is not tied to any physical currency.
But it is not without controversy, as with all transactions encrypted and hard to trace, there have been numerous reports of it being used as part of illegal activity.
The IWF said it was working with several of the world's largest bitcoin exchanges to share intelligence and develop strategies for preventing the currency being abused by distributors of child sexual abuse images.
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