How Many Police Agencies Are Going After Darknet Markets?

Bitzlato maintains significant operations in and connected to Russia and to Russian illicit finance through its facilitation of deposits and funds transfers by Russia-affiliated ransomware groups or affiliates, and transactions with Russia-connected darknet markets. Following Hydra’s closure in April 2022, Bitzlato continued to facilitate transactions for growing Russia-connected darknet markets, including BlackSprut, OMG! AlphaBay operated as a hidden service on the “Tor” network, and utilized cryptocurrencies including Bitcoin, Monero and Ethereum in order to hide the locations of its underlying servers and the identities of its administrators, moderators, and users. Based on law enforcement’s investigation of AlphaBay, authorities believe the site was also used to launder hundreds of millions of dollars deriving from illegal transactions on the website. This operation to seize the AlphaBay site coincides with efforts by Dutch law enforcement to investigate and take down the Hansa Market, another prominent dark web market. Like AlphaBay, Hansa Market was used to facilitate the sale of illegal drugs, toxic chemicals, malware, counterfeit identification documents, and illegal services.

Darknet markets, also known as “cryptomarkets,” are online marketplaces that operate on the dark web, a part of the internet that is intentionally hidden and requires special software to access. These markets are used to buy and sell illegal goods and services, including drugs, weapons, and stolen data.

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Law enforcement faces a challenge both in acquiring relevant technical data and in turning it into evidence understandable to the public, members of which sit on juries deciding the guilt or innocence of those charged with dark web crimes. The evidence challenge is heightened by the growth of data quantity, indecipherable formats, and the need for cross-jurisdictional coordination. In light of difficulties posed by the encryption and anonymity features of software used on the dark web, the participants urged that law enforcement use best available standards, tools, and processes to capture evidence. To that end, a high-priority need identified during the workshop is encouraging establishment of standards for new processes used to capture dark web evidence.

The Rise of Darknet Markets

• Wallet services offer more privacy than ever before, and dark web markets have expanded the types of coins they will accept.
• The majority of respondents only filled out the questionnaire in part, which can be explained by the length of the survey and its complex, repetitive situational questions.
• The United States is committed to taking action against those who engage in money laundering or the financing of terrorism and allow their systems to be abused for illicit purposes.
• Shier also mentioned how the German administrators of Wall Street Market, another darknet marketplace, gave away their real IP address when logging into the site’s server infrastructure even though their VPN service was playing up.

In recent years, darknet markets have exploded in popularity. According to a report by the European Monitoring Centre for Drugs and Drug Addiction (EMCDDA), the number of darknet marketplaces grew from 27 in 2013 to 50 in 2015. As of 2021, there are estimated to be over 100 active darknet markets.

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The Response of Law Enforcement

As the use of darknet markets has grown, so too has the response from law enforcement agencies around the world. Here are just a few examples:

• In 2013, the FBI shut down the Silk Road, one of the earliest and most well-known darknet markets, and arrested its founder, Ross Ulbricht.
• In 2014, Europol launched a coordinated operation targeting darknet markets, resulting in the arrest of 17 individuals and the seizure of €4.5 million in cash and virtual currencies.
• In 2017, the US Department of Justice announced the takedown of AlphaBay and Hansa, two of the largest darknet markets at the time, resulting in the arrest of 35 individuals and the seizure of over $1 billion in cash and virtual currencies.
• In 2021, German authorities arrested the alleged operator of DarkMarket, the world’s largest darknet marketplace at the time, and seized over 20 servers used to run the market.

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FAQs

How many police agencies are going after darknet markets?

It’s difficult to say exactly how many police agencies are actively investigating and targeting darknet markets, as many operations are coordinated across multiple jurisdictions and countries. However, it’s clear that law enforcement agencies around the world are taking the threat of darknet markets seriously and are dedicating significant resources to combating them.

Recent academic research indicates that over half of all Tor-based onion services facilitate crime in some form or fashion. Other potential illegal activities include identity theft, blueprint distribution, human trafficking, and weapon sales. The FBI’s 2013 crackdown on the Silk Road marketplace, an online narcotics bazaar, was a high-profile response to a large operation, the report noted.

What techniques are police using to investigate darknet markets?

As a result, threat actors have migrated elsewhere, including to forums like “RuTor,” decentralized Telegram-based shops, and even switching to offline transactions for physical commodities like narcotics. This study was designed to list trust factors potentially affecting illicit drug purchases and to test out their ranking by using a survey study based on a projective technique. Therefore, this research is limited by the fact that it could not build on the results of previous survey research. However, the results of this study could facilitate further research in replicating this projective methodology or applying the list of factors as a module of a questionnaire to be conducted among actual darknet market users. Data protection, privacy, and legal information form another necessary category of trust factors.

Police agencies use a variety of techniques to investigate darknet markets, including:

The deconfliction systems that currently exist, commonly conducted under the overseeing High Intensity Drug Trafficking Area (HIDTA), often leave SLTT partners out of the investigatory process. Without having direct access to those deconfliction systems, the SLTT partners often don’t utilize them. As such, this results in either a “stovepiping” of intelligence that disenfranchises the SLTT partners or a lack of intelligence altogether. Also, there are sections for particular countries, cryptocurrencies and popular TOR websites. Only pedophilia, pro-terrorism, poisons, weaponry and assassinations related topics are prohibited. Operation Bayonet led by the FBI and DEA, meanwhile identified the alleged creator and administrator of AlphaBay, a Canadian citizen in Thailand.

• Undercover operations: Police officers pose as buyers or sellers on darknet markets to gather intelligence and make arrests.
• Network analysis: Police use software tools to map out the connections between different darknet marketplaces and their users, helping to identify key players and patterns of behavior.
• Cryptocurrency tracing: Police use blockchain analysis tools to track the flow of virtual currencies used on darknet markets, helping to identify and seize illicit funds.
• Collaboration with international partners: Police agencies often work together across borders to share intelligence and coordinate operations against darknet markets.

Can darknet markets be completely shut down?

Running the network maps to identify the scale of the co-occurrence network, the Biblioshiny indicated that cluster 1 (red) with the ‘cybercrime’ is the highest betweenness (33.5%) with its cluster and closeness (0.076%) with others. Accordingly, except for ‘cryptomarket’ and ‘silk road’—at the central pillars, ‘cybercrime’ is also connected with five themes in the blue and green groups. Betweennesses and closeness of the former are 16% and 0.058%, while the latter is 9.5% and 0.055%, respectively. In particular, the narrowing down of topics relating to the darknet/darkweb has been conducted from these two clusters.

It’s unlikely that darknet markets can be completely shut down, as new ones are likely to emerge to replace those that are taken down. However, law enforcement agencies can disrupt and dismantle individual markets, making it more difficult for criminals to operate with impunity.

What can be done to prevent the growth of darknet markets?

Preventing the growth of darknet markets is a complex challenge that requires a multifaceted approach. Here are a few possible strategies:

• Improving cybersecurity: Stronger cybersecurity measures can help prevent hackers from stealing sensitive data and selling it on darknet markets.
• Reducing demand for illegal goods: Public awareness campaigns and harm reduction initiatives can help reduce demand for illegal goods, making it less profitable for darknet markets to operate.
• Strengthening international cooperation: Police agencies around the world need to work together to share intelligence and coordinate operations against darknet markets.
• Investing in technology: Law enforcement agencies need access to cutting-edge technology to track and trace virtual currencies, map out darknet marketplaces, and identify key players.

The use of darknet markets for illegal activities is a serious concern, and law enforcement agencies around the world are working hard to combat this threat. While it may be difficult to completely shut down these markets, police agencies are using a variety of techniques to disrupt and dismantle individual markets and prevent the growth of this illegal activity.