Understanding the Role of Bitcoins in the Dark Web
Online cryptocurrency trading markets (exchanges) have varying levels of compliance with regulations regarding financial transactions. What is important, especially after the service of a search warrant on a computer or cell phone, is to document the use of cryptocurrency wallets. As good practice, use an internet search engine to identify any apps that you do not recognize.
The intersection of bitcoins and the dark web has garnered significant attention over the years. This combination has become synonymous with anonymity and illicit activities. Exploring its implications sheds light on an increasingly complex digital landscape.
While this is a predominantly drug-oriented market, an entire “Other” section features many items of interest to threat actors. Among these items are hacking utilities, stolen banking info, and compromised credentials. While not the biggest dark web marketplace for hackers, it’s still not a bad idea to monitor this site due to its continued growth. Attacks typically target users of banking, cryptocurrency, e-commerce sites, and even email. Web injects often take the form of adversary in the browser (AitB) attacks where an unsuspecting user installs a trojan horse on their smartphone.
With the pandemic stalling or halting activities in the physical world, similar repercussions were witnessed in Darknet markets as per some self-reported studies [11,12]. However, some researchers suggest hoarding addictive drugs due to the perception of potential shortage as a trigger to use Darkweb during the pandemic [13]. Overall, our study provides a first step towards a better microscopic characterisation of the DWM ecosystem, indicating a direction of investigation that may be of interest to both researchers and law enforcement agencies. The results further support the recent efforts of law enforcement agencies to focus on individual sellers43,44,45, as well as, more recently, also buyers46,47. Since the beginning of DWMs’ activity, there has been a shift in the law enforcement approach from focusing on market admins towards sellers and buyers9,13.
What is the Dark Web?
Dominant Markets
In addition, the use of Bitcoin in dark web transactions has also led to the development of new technologies and innovations that have improved the security and anonymity of Bitcoin transactions. For example, the development of blockchain technology has made it possible for Bitcoin transactions to be recorded on a public ledger, which ensures that all transactions are transparent and cannot be altered. This has made it more difficult for hackers or scammers to manipulate the bitcoin network and has increased the overall security of the system. One of the significant concerns for buyers and sellers on the dark Web is the possibility of fraud.
However, as discovered during the unraveling of the Silk Road saga, the Bitcoin network uses a public ledger to store transaction history. Therefore, anyone can look up past transactions and link them to wallet addresses. If such wallet addresses are linked to registered and verified accounts, then it is possible to link them to real identities.
As of August 2017, ZHONG thus possessed 50,000 BCH in addition to the 50,000 Bitcoin that ZHONG unlawfully obtained from Silk Road. ZHONG thereafter exchanged through an overseas cryptocurrency exchange all of the BCH Crime Proceeds for additional Bitcoin, amounting to approximately 3,500 Bitcoin of additional crime proceeds. Collectively, by the last quarter of 2017, ZHONG thus possessed approximately 53,500 Bitcoin of total crime proceeds (the “Crime Proceeds”). “This alleged scheme was a brazen attempt to use the dark web to conceal a national drug trafficking operation. Even though this activity originated on the dark web, it can still lead to the same dangerous drug-related violence in our neighborhoods that we see far too often,” said District Attorney Bragg. “Technology is evolving but so is our office and I am grateful to the talented prosecutors, investigators and analysts who are diligently working on and bringing their leading expertise to this complex case.
The dark web constitutes a part of the internet that is not indexed by traditional search engines. It requires specific software and configurations to access. Through this space, various activities occur, some legitimate and others nefarious.
How Bitcoins Facilitate Transactions on the Dark Web
Bitcoins are often the preferred currency for transactions on the dark web due to several factors:
- Anonymity: Bitcoins allow users to transact without revealing their true identities.
- Decentralization: Being a decentralized currency, bitcoins are not subject to government regulation.
- Global reach: Transactions can occur across borders without the need for traditional banking systems.
The Dark Side of Bitcoins on the Dark Web
While bitcoins provide a level of anonymity, this same feature has led to various illegal activities:
- Illicit Markets: Various online marketplaces sell illegal goods such as weapons, drugs, and stolen data.
- Hacking Services: Services for hire often operate through dark web forums, taking payments in bitcoins.
- Fraud and Scams: Numerous scams exist where unsuspecting users lose their bitcoins.
How Bitcoins are Used in Dark Web Transactions
Typically, users engage in transactions through a series of steps:
- Despite the currency no longer being directly tied to crime, money launderers still need a way to explain how they came into possession of the currency.
- According to him, Litecoin is popular because it has faster processing times as compared to bitcoin and can be stored in offline wallets.
- Due to the anonymous nature of bitcoin, it has become the preferred currency for Dark Web transactions.
- In this case, the features of bitcoins – anonymity, ease of cross-border transactions and finality of settlement – were a perfect vehicle for criminals to conduct their illegal activities on the site.
- Five datasets were used to characterize the evolution of these attacks and their impact on global Internet traffic, Darknet scanning activity, active probing, global DDoS attack victims and incidents, and local ISP impact.
- Download and configure a specific browser, such as Tor.
- Create a secure bitcoin wallet.
- Find a marketplace on the dark web that accepts bitcoins.
- Conduct the transaction while taking precautions to maintain anonymity.
Implications for Law Enforcement
The rise of bitcoins in the dark web poses challenges for law enforcement agencies:
- Tracing Transactions: Although bitcoins are somewhat anonymous, they can eventually be traced back through blockchain analysis.
- International Cooperation: The global nature of the dark web necessitates cross-border collaboration for effective enforcement.
FAQs on Bitcoins and the Dark Web
Q1: Can I get caught using bitcoins on the dark web?
A1: Yes, while bitcoins provide anonymity, law enforcement agencies are improving their capabilities to trace transactions.
Q2: Are all uses of bitcoins on the dark web illegal?
A2: No, there are legal uses, but the majority of discussions tend to focus on illegal activities.
Q3: How does a bitcoin wallet work?
A3: A bitcoin wallet stores your private keys, allowing you to send and receive bitcoins securely.
Conclusion
The relationship between bitcoins and the dark web represents a dual-edged sword that fascinates and frightens. With the potential for both innovation and illicit activities, it is crucial for users and society to understand its implications.
