Darknet Market Revenue Plummeted To $13 Billion In 2022
Understanding the Situation: Why Are All the Darknet Markets Down?
Silk Road was shut down in 2013 by the FBI and its creator, Ross Ulbricht, got two life sentences. In 2014, in the second year of operation, that was also shut down by law enforcement. Successor after successor has since popped up, with drug-related darknet marketplaces surviving an average of 232 days before their shutdown and inevitable reincarnation.
After observing unusual darknet marketplace activity over the past few weeks, our analysts performed a retrospective investigation that uncovered a widescale shift of the active-marketplace spectrum. This investigation was prompted by the observation that, over the last two weeks, a number of prominent darknet marketplaces suddenly went offline without any indication of their return, or any explanation regarding the cause of their disappearance. Upon further analysis, data demonstrated that in late December, URLs for over 30% of the known darknet markets operating on Tor would not load. The volume of downed marketplaces prompted DarkOwl’s team to take a closer look, only to discover an underground community as perplexed as we were.
Some of them theorized that owners were carrying out an exit scam, while others believed it was an FBI takeover, and a few of them felt the service was on the verge of becoming a liability. Eastern Europe sends and receives the most value from darknet vendors because of Hydra, which is a major market outlier. Hudson Intelligence assists law firms, businesses, public agencies and investors with cryptocurrency investigations and due diligence. Every investigation is led by a Cryptocurrency Tracing Certified Examiner (CTCE) and Certified Fraud Examiner (CFE).
I remember back in 2015, a few days after my first experience with MDMA, a good friend of mine who had acquired the M told me he obtained it online. Considering the monthly sales volume by category (Fig. 5), we observed a similar trend for available listings (Fig. 3), with most sales occurring between mid-2014 and mid-2015. The trust matrix was created by ordering the means of the importance of each trust factor. Due to the lack of a normal distribution of the sample, we performed non-parametric tests in addition to presenting descriptive statistics.
However, estimating counterfeit goods’ trade (value) is difficult and is mostly achieved through auditing goods seized at borders (OECD, 2018; OECD/EUIPO, 2019). Thus, current estimates often exclude domestically traded counterfeits or digital products, and since not all counterfeits will be seized at ports, estimates of what is traded may be incomplete. For example, the number of routinely checked containers at major ports in Genoa (Italy), Melbourne (Australia), Montreal (Canada), New York (USA), and Liverpool (UK) together only account for 2–5% of all traffic (Sergi, 2022). Since only a limited number of containers can be checked, the selection procedure can strongly impact possible finds.
The phenomenon of darknet markets being down has raised numerous questions and concerns among users, researchers, and law enforcement alike. Several factors contribute to this widespread outage, and understanding these can provide insight into the ever-evolving landscape of the darknet.
Dark markets, as well as various other services within darknets, are hosted as ‘hidden services’. This means that the servers providing these services are only accessible via Tor and do not have a public IP address or domain name. Hidden services can operate while keeping the physical location of the server hidden, which makes tracking and shutting them down considerably more challenging. Adaptation and Fluctuation — Successful law enforcement operations against dark web interests commonly cause users to adapt quickly, shifting to different markets or creating entirely new markets. Workshop participants noted that dark web users often exchange information on how to evade detection by law enforcement.
Many marketplaces do not last long before they either suddenly shut down – usually performing an exit scam – or are taken offline by law enforcement agencies. In recent years, very popular marketplaces like Dream Market, AlphaBay, Hansa market, or Wall Street Market went offline, but others quickly took their spot as users looked for alternatives. Sometimes new iterations of closed marketplaces showed up again after a while using the same name and sometimes operated by the same individuals as before. For example, the second version of AlphaBay is now online since August 2021 after the predecessor was shut down in 2017. Dark markets provide a one-stop-shop for cybercriminals, offering a wide range of services such as hacking tools, stolen data, ransomware, and Distributed-Denial-of-Service (DDoS) attacks for hire.
Factors Contributing to Downtime of Darknet Markets
There are various reasons why darknet markets experience outages. Here are some of the most significant factors:
- Law Enforcement Operations: Periodic crackdowns by law enforcement agencies can significantly impact the availability of these markets.
- Server Issues: Technical problems, ranging from server malfunctions to DDoS attacks, can render markets temporarily inaccessible.
- Market Shutdowns by Admins: Operators may choose to shut down their platforms due to security concerns, financial issues, or the desire to avoid legal repercussions.
- Migration to New Platforms: Some markets may move to new domains or platforms, causing temporary outages as users transition.
- Scams and Rug Pulls: In some cases, markets are designed to be temporary, with the administrators disappearing after a period, effectively taking users’ funds with them.
The Impact of Down Markets
The downtime of these markets can have several implications:
- User Impacts: Users may lose access to goods and services, face financial losses, or become targets for scams.
- Increased Scrutiny: Law enforcement may increase surveillance on the darknet, leading to more arrests and market shutdowns.
- Shift in Usage Patterns: Users may seek alternative platforms or move to cryptocurrencies that offer greater anonymity.
FAQs about Darknet Market Downtime
1. What should I do if my favorite darknet market is down?
If your preferred market is unavailable, it is advisable to wait and monitor for announcements via community forums or alternative platforms. Engaging with established networks can provide updates on market status.
- In 2015, drug-related products accounted for 70% of total sales in darknet markets.
- Since then, new decentralized marketplaces have started popping up, making it harder to shut down a darknet market by targeting a specific batch of servers.
- European authorities plan to use seized DarkMarket servers from Ukraine and Moldova to investigate the buyers and sellers who used the site for criminal transactions.
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- Generally, these types of attacks are ongoing and marketplace operators must remain vigilant to ensure their own safety, as well as that of their users.
- The Hydra crew would certainly be notified about a disinformation attack and would attack back.
2. Are there safe alternatives to darknet markets?
While there may be alternatives, users must be extremely cautious. Not all platforms have the same level of security or trust. Research and community feedback are crucial for making informed choices.
3. How can I protect myself while using darknet markets?
- Always use a VPN to mask your IP address.
- Utilize trusted escrow services for transactions.
- Engage only in reputable markets with positive community reviews.
Conclusion: The Uncertain Future of Darknet Markets
The question of why are all the darknet markets down reflects deeper issues related to security, legality, and market dynamics. Users must stay informed about potential risks and remain agile in adapting to the evolving landscape of online marketplaces. As law enforcement and technology continue to evolve, the availability and operation of these markets may further change, leaving users to navigate a challenging environment.
