Why Are All the Darknet Markets Down?

For instance, AlphaBay Market’s second iteration – which claims to be the world’s largest DNM – is a Monero-only marketplace. The Russian-language DNM space is preparing for the inauguration of the widely-anticipated Kraken Market, touted by the community as Hydra Market’s successor. Several marketplaces operating in the former Soviet Union could disappear as vendors and buyers establish themselves on this new DNM, resulting in a greater centralization of marketplaces in this region. This suggests some continuity in the financial infrastructure of funds leaving darknet vendors following the takedown. However, 334 cash-out service entities (mainstream exchanges, high-risk exchanges and mixers) that received funds from both Hydra and its top five successors (Mega, Blacksprut, OMG!OMG!, Kraken and Solaris) showed an overlap of just under 50 percent. Given that these stores often operate under new names, it is difficult to assess with absolute certainty whether they were present on Hydra or just planting the reviews for publicity.

Is My Identity At Risk On The Dark Web?

In recent months, many darknet markets have gone offline, leaving users wondering why.

Recent Shutdowns

What’s Next For Darknet Markets?

• In July, Tor Browser began displaying a “deprecated soon” warning message every time a v2 onion service was accessed.
• Through online investigative efforts and the concerted activities of different agencies, the problem can be addressed but it will not disappear.
• The BKA confiscated 543 bitcoins with a total value of around 23 million euros.
• The operation, dubbed SpecTor, also included the seizure of 117 firearms, 850 kilograms of drugs — including 64 kilograms of fentanyl or fentanyl-laced narcotics — and $53.4 million in cash and virtual currencies, the U.S.

Some of the most popular darknet markets, such as Wall Street Market and Valhalla, have been shut down by law enforcement agencies in recent months. These shutdowns have resulted in the arrest of several high-profile darknet market operators and the seizure of millions of dollars in cryptocurrency.

LockBit Takedown: What You Need To Know About Operation Cronos

Operation DisrupTor

One of the largest coordinated efforts to take down darknet markets was Operation DisrupTor, a joint operation between the FBI, DEA, and Europol. This operation resulted in the seizure of over $6.5 million in cryptocurrency, as well as the arrest of over 170 individuals.

Counterfeit Prices, Sales Volume, And Surface Web Prices

Cyber Attacks

However, as expected, the overall number of offers is much lower, with counterfeits accounting for around 2.69% of all listings across markets. Interestingly, the observed proportion of counterfeits on dark markets coincides well with the estimated overall proportion of counterfeits worldwide (3.3%) discussed above (OECD/EUIPO, 2019). Furthermore, only nine of the eleven markets seem to offer counterfeits, with Agora and Evolution offering the most, followed by BlackBank Market, Alphabay, and Middle Earth Marketplace. With this in mind, risk assessments are often conducted to aid decisions made by authorities at borders based on intelligence from federal and local authorities and custom officer experiences (Sergi, 2022). Furthermore, border checks can be random or may only be informed by the country of origin, or how the delivery is labeled, as in the case of parcel shipments (Männistö et al., 2021).

In addition to law enforcement shutdowns, many darknet markets have also been taken offline due to cyber attacks. These attacks can be carried out by hackers looking to steal user data or by rival darknet markets looking to take out the competition.

As it is with the old school street drug trade, closing dark net markets does very little to reduce demand. If anything, a flurry of activity is seen on forums as users try to contact their favourite vendors offline and elsewhere. Buying drugs by post offers too many advantages to drug users for them to simply stop. The Silk Road market operated on the Tor network, which masks your identity through IP address anonymity and encryption technology, while allowing you to find other websites on the dark web. Within the Tor network, customers could access the Silk Road, then anonymously connect with vendors to buy illegal goods with cryptocurrency.

This could indicate that casual buyers or those buying drugs for personal use are shifting away from darknet markets, while those buying in larger amounts — either for personal use or to sell to others — are purchasing more. It could also mean that some casual buyers have begun placing larger orders to stock up amidst uncertainty. As we’ll explore below, the pandemic has indeed strained postal systems around the world, leading to delivery failures and delays for many darknet market vendors. But the experts we spoke to don’t think that Covid is to blame for this year’s rash of market closures. Instead, it appears that ever-increasing competition combined with the efforts of law enforcement are causing the darknet market ecosystem to consolidate to a few big players — a pattern common to the technology industry and other markets, both legal and illegal. Below, we’ll share our findings on darknet market activity in 2020, how it’s changed throughout the pandemic, and provide possible reasons why so many markets have closed.

Volatility of the Darknet Market Ecosystem

The darknet market ecosystem is also highly volatile, with markets constantly coming and going. This volatility can be attributed to a number of factors, including law enforcement activity, cyber attacks, and internal disputes among market operators.

Conclusion

The recent wave of darknet market shutdowns and cyber attacks has left many users wondering why all the darknet markets are down. While law enforcement activity and cyber attacks are certainly factors, the volatility of the darknet market ecosystem also plays a significant role. As a result, it is likely that we will continue to see darknet markets come and go in the future.