A recently-published report by the Rand Corporation, a global policy think tank, explicated the place of the privacy-centric digital coin Zcash within darknet criminal circles. Quite surprisingly, the report discovered that Bitcoin is still the preferred crypto used for illicit dark web activity.
As mentioned by media reports, the organization credited with founding Zcash commissioned the study, whose release came on May 6. The report reflected a scenario that has long been a reality within the dark web that criminals would still pick Bitcoin over Zcash even considering the crypto’s obvious advantages against the king of digital assets.
In fact, the study detected a less dominant presence of Zcash in darknet spaces, an aspect that suggested that the coin was considered to be far less attractive to darknet users compared to other crypto options.
Considering that virtual currencies continue to be used for legitimate transactions, crypto has been a common facilitator of criminal purposes by a wide range of threat actors
To understand the crypto-darknet landscape, the Rand research report focused on the three main areas that represent illicit cryptocurrency use in money laundering, trade in illegal goods or services and terrorism financing.
As such, the following findings were made:
- Zcash has not attained prominence within the academic research community, an aspect that extends to the realization that the privacy-centric coin has not appeared in a substantial number of research studies seeking to evaluate the linkages between Zcash and criminal enterprise.
- The study did not indicate the possibly-perceived widespread application of Zcash, although the report recommended continuous vigilance in this context.
- Zcash represents a minor significance within dark web economy, suggesting that the virtual currency is perceived as a less preferred crypto choice to darknet users. Thus, it is used less in contrast with the distribution of other cryptocurrencies like Monero and Bitcoin.
- Most importantly, Bitcoin still reigns as far as crypto dominance within the dark web is concerned. A host of darknet criminals seemed to pick the digital coin as a payment option for users seeking to procure illicit goods and services.
Concerning the above findings, the report inferred that that dark web criminals may not be picking Zcash owing to their lack of sufficient understanding of the coin’s operating model. In addition, the lack of full understanding of Zcash privacy-centric advantages may be well beyond their scope of awareness.
Looking Back – a Rather Ironic Preference
Findings of the Rand research report echo the expert observations made last year by The Block Research, which named Bitcoin, Monero and Litecoin as the most preferred crypto options within dark web sites with Bitcoin towering over its peers.
In the report, 29 darknet marketplaces favored Bitcoin out of the 31 dark web sites that were surveyed at the time with only two markets supporting Zcash.
Also, according to 2019’s annual Internet Organized Crime Threats Assessment (IOCTA) from Europol, Bitcoin was the most preferred cryptocurrency by cybercriminals.
The same year, while Monero tried to gain traction with the promise of superior privacy capabilities, alternative cryptocurrencies failed to outcompete Bitcoin in the three key areas of crypto performance including network effects, brand recognition and general familiarity.
Although Bitcoin remains to be a popular crypto among dark web users, considering that it is widely thought to be the top tier anonymous currency, the reality is that Bitcoin transactions fail significantly on the privacy score.
While real identities are not directly link to every transaction, anyone can easily download Bitcoin’s blockchain data – which bears all transitions done in the crypto’s history.
Unfortunately, even though innovations like the Lightning Network have been unveiled to cater for privacy-centric users, the privacy of Bitcoin transactions is a far cry from that of its competitors.