Even those who are not overly familiar with the cryptocurrency industry have likely heard of the darknet, as it has been immortalized in popular culture and internet discourse. The darknet is a section of the internet unreachable by traditional browsers and is ensures a high level of traceability and anonymity. As a result of this, it has become a popular hotbed for criminal activity and has marketplaces for everything from drugs to illegal weapons.
Cryptocurrency has also played a significant part in the dark web as it has been used to facilitate payments for such illegal activities and avoid tracking by law enforcement. However, a new report by CipherTrace states that the landscape of the darknet has changed. These new changes are due to several exit scams in the last few months as well as regulations.
A Changing Darknet
The recent exit scams have created a gap within the various darknet markets, particularly for users in the West. Despite this, the report notes that no new market pace has sprung up to replace them just yet. As of now, the biggest darknet marketplace is the Hydra market which focuses mainly on Russia.
Hydra has certainly proven to be profitable as between June 2019 and July 2020, the market brought in $1.2 billion in revenue despite being a niche market. Globally, the structure of the darknet seems to have evolved. In the past, it was made up of a few very powerful markets but now seems to favor smaller ones that operate in their own niche and region.
This switch was abrupt to a degree and this was thanks to a few major exit scams. The Empire Market, for example, exited the market in 2018 with $30 million worth of users’ funds. In response, users migrated to the Icarus Market but that too vanished from the darknet a few weeks later.
The report suggests that the new influx of users might have played a part in the decision to exit the market at that time.
“It’s probable that the large influx of new users from Empire and their deposits made Icarus ripe for a profitable exit. As a result, the admins may have taken advantage of the opportunity and exited sooner than they had originally planned,” the report says.
As of now, the most powerful marketplaces that serve the west are White House Market and DarkMarket, which have over 300,000 users each.
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