Cryptocurrencies accounted for $1.8 billion (R26.4 billion) in drug revenue in 2021, research by The hour without bank.
This, he says, represents 85% of the total revenue generated on these “darknet markets”.
the darknet is a part of the Internet where communications and transactions can be conducted anonymously and is often used by criminals (although it is also used by activists, whistleblowers, journalists and news organizations for secure communications).
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Around 15% of darknet revenue – the equivalent of $300 million (R4.4 billion) – has been generated by so-called fraud shops, which include the sale of stolen logins, credit cards, among others.
Earnings for darknet traders could be higher, according to the study. Reports indicate that an additional $112 million (R1.65 billion) in revenue was generated from direct buyer-to-seller sales, bypassing darknet marketplaces.
Banklesstimes says there were several darknet market closures in 2021 and by the end of the year there were five fewer fraud shops and 13 fewer drug markets.
“It should also be noted that the drug markets have been in decline for five years. The number of active users has increased from approximately 1.7 million in 2016 to 1.2 million in 2021. The number of transfers has also decreased, from 11.7 million to 3.7 million.
Despite a decline in the number of users and illegal marketplaces, revenue from crime-driven sales has actually increased.
“Users in drug-driven markets are now making larger payments for each transaction. Over the same period, the average transaction size increased by more than 208%, from $160 in 2016 [R2 358] at $493 [R7 266] value of crypto in 2021,” the report states.
In 2021, direct transactions accounted for around 5% of total darknet market revenue, which has been steadily increasing for three years.
“Typically, these direct relationships begin in darknet markets, but then transition to off-market transactions once sufficient trust has been established between the trading parties. Total revenue from these transactions in 2021 was $112 million [R1.65 billion].
“On average, a typical buyer sent $8,331 [R122 800] value of cryptocurrency to their provider over the year.
Hydra, a market designed for Russian-speaking countries, continues to dominate global darknet markets.
Hydra’s revenue in 2021 was about 80% of the revenue of the entire darknet market, according to the US Department of Justice (DoJ).
Other darknet markets include DarkMarket, ByPass Shop, and Flugsvamp Market.
A joint law enforcement effort by the DoJ and German authorities led to the entry and closing from the Hydra market on April 5 this year.
The DoJ has also filed criminal charges against one of the alleged market operators.
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“The Hydra darknet site provided a platform for criminals who thought they were beyond the reach of law enforcement to buy and sell illegal drugs and services,” said the agency’s Jim Lee. US Internal Revenue Service criminal investigation in a DoJ. statement.
“Our Cyber Crimes unit has once again used their cryptocurrency tracking expertise to help take down this site and identify the criminal behind it.
“Denying criminals a space to operate freely to carry out their nefarious activities is the first step to completely preventing this activity from occurring.”
“The successful seizure of Hydra, the world’s largest darknet market, dismantled the digital infrastructure that had enabled a wide range of criminals – including Russian cybercriminals, cryptocurrency thugs and money launderers who support them and others, and drug dealers,” the FBI director said. Christopher Wray.
Hydra vendors offered fake IDs, allowing users to search for the type of ID they wanted, such as US passports or driver’s licenses. Many sellers offer fake IDs using photographs or other information provided by buyers.
Hacking tools and services are also available through Hydra. “The hacking vendors typically offered to illegally gain access to online accounts chosen by the buyer. This way, buyers could screen their victims and hire professional hackers to access victims’ communications and take over victims’ accounts,” according to the DoJ.