The resilience of the dark-net markets is evident in the increased volumes of cryptocurrency flows getting in. For the first time in four years, the cryptocurrency flow in the dark-net markets has doubled despite heightened law enforcement.
Chainalysis, a New York-based blockchain analytics firm in a portion of its 2020 Crypto Crime report released on 28th January, indicated that the incoming crypto transactions in Dark-net markets totaled from 0.04% in 2018 to 0.08% in 2019.
For the first time in years, the total market sales of crypto surpassed the $600 million mark to over $790 million in 2019, a growth by 70%.
Can the Increased Legal Scrutiny by Global Regulators Suffice?
The increased efforts by law enforcement bodies is evident through the number of arrests reported in the recent past. The latest one coming in early in the year 2020, with the arrest of a US citizen trading narcotics in exchange for Bitcoin.
Chainalysis reports that as the closure of quite several darknet markets is achieved, more keep on mushrooming behind the scenes.
The study by Chainalysis revealed that the total number of stable darknet markets stands at 49. The closure of 8 dark-net markets in 2019, which were active in 2018, resulted in the creation of eight new ones.
The fight against the markets may not be a walk in the park after all. The stability of these markets owes to the fact that there exist loyal customers. Therefore, every marketplace experiences an increased inflow of cryptocurrency.
Darknet, Drugs and Illicit Businesses
A graph is presented by Chainalysis showing total Bitcoin transaction volume for darknet markets, exchanges, gambling sites, and merchant services for a 30-day moving average between March 2019 and November 2019.It indicates that the darknet activities are less influenced by the seasonal changes and the ebbs and flows in the cryptocurrency markets.
One of the reasons is the rampant online drug trade and an ever-growing market caused by opioid addiction. Illicit businesses that may include crimes associated with murder, terrorism, and theft. All these happen within the confines of the Tor markets.
The changes in the value of Bitcoin and other cryptocurrencies do not, therefore, prevent customers in the darknet from transacting.
In the presented graph, the other categories reveal spikes in July due to a surge in Bitcoin price. The markets, however, did not experience much significant change.
Closing Markets or Arresting Vendors
The operators of marketplaces are becoming smarter by the day and they keep on evolving in the face of increased shutdowns.
Law enforcers are faced with a nightmare, in regards to whether to continue forcing the closure of these avenues. Chainalysis observed that the arrest of vendors in the illicit business should also be considered in the fight against the menace.
