Germany’s Federal Criminal Police Office Takes Down Hydra Darknet Marketplace
Understanding the Shutdown of Darknet Markets
The Silk Road dominated the darknet until October 2013, when it was seized by the Federal Bureau of Investigation (FBI). In its wake, many more darknet marketplaces emerged (including the Silk Road 2.0), with some (e.g. Evolution and Agora) surpassing the size of the original Silk Road. In addition, from early 2014, retailers began to increasingly operate across more than one marketplace, with 10% doing so by July 2014. In November 2014, an international law enforcement operation (dubbed ‘Operation Onymous’) seized the Silk Road 2.0 along with other darknet markets and the servers on which they operated. Since this time there have been many more market disruptions that have had an impact on these markets.
The question of why are all the darknet markets down has become increasingly prevalent among users and observers of the dark web. Darknet markets serve as platforms for the trading of illegal goods and services, often operating under the radar of law enforcement. Several factors contribute to the temporary or permanent shutdown of these markets.
Silk Road not only aggregated thousands of drug vendors, it created a user-friendly interface that resembled a clear-net shopping website. Ulbricht was eventually arrested by US law enforcement and Silk Road was seized and taken offline. It should come as no surprise that Dark Web marketplaces, which are regular resellers of hacked credentials and hacker attack methods, also fall victim to hackers. Sometimes, these are organized by competitors in order to increase their market share by doing away with other markets. Other times, hackers gain access to Dark Web market servers just to see if they can.
Another thing is that the Hydra announcement mentioned before has a provocative tone. They speak directly that they are aggressive, eager to fight with any adversaries that want to disturb their business and they are ready for global expansion in the darknet Market sector. At its prime, AlphaBay was ten times the size of its predecessor, Silk Road (which was busted in October 2013).
Key Reasons for Downtimes
In terms of drug sales, Hydra Market became the largest narcotic market among the former countries of the USSR. Hydra Market met a similar demise to the Silk Road when it was shut down by German police in April 2022. Both Hydra itself and its vendors also offered money laundering services, including a tightly-controlled and regimented infrastructure allowing vendors and other cybercriminals to convert cryptocurrency into Russian rubles using a few pre-approved services.
There were various illegal drugs including heroin, Ecstasy, LSD, marijuana and steroids. Also, illegal weapons, books on how to construct bombs, counterfeit identification and counterfeit merchandise. The arrests stem from the December 2021 seizure of the infrastructure supporting the Monopoly Market, a darknet drug marketplace dating back to 2019. After German authorities seized the infrastructure, authorities compiled intelligence that served as the basis “for hundreds of national investigations,” according to a statement issued by Europol Tuesday. Europol coordinated with nine other law enforcement agencies to take down the dark web marketplace Monopoly Market.
Various dynamics can lead to the unavailability of darknet markets, including:
These can serve areas ranging from local neighborhoods to entire cities and regions, but most importantly, the vendors’ reach is not international. Year-over-year, Dark Web marketplace revenues at the end of 2021 were about $3.1 billion, but by the end of 2022 they totaled only about $1.5 billion. Had already amassed $12.15 million in sales by the end of its first month in operation (April 2022). As of this publishing, Mega currently appears to be the biggest of the five Russian language DNMs. Mega received nearly $40 million in March 2023, followed by Blacksprut with around $20 million.
In light of the major announcement of Joker’s Stash shutting down on February 15th, 2021, we’ve dived into the cybercrime underground to understand more about the closures of Dark Net marketplaces and where market’s users migrate to. The last several years have seen a vise-like grip tighten around dark internet venues like DarkMarket. Whatever advantage sites like Alphabay or The Silk Road had years ago seems to have disappeared as government agencies have gotten more aggressive in hunting down these marketplaces and more capable of understanding how they work. In 2015, drug-related products accounted for 70% of total sales in darknet markets.
- Law Enforcement Actions: Authorities across the globe regularly conduct operations to shut down illegal activities on the dark web. Successful raids can lead to the immediate closure of popular markets.
- Market Owner Exit Scams: Some markets may disappear without warning if the administrators choose to abscond with customer funds, leaving users in the lurch.
- Technical Issues: Just like any other online platform, darknet markets can face technical difficulties, server outages, or DDoS attacks, disrupting their availability.
- Market Saturation: As more markets emerge, competition can lead to some being unable to sustain operations, resulting in their eventual closure.
- Community Trust Issues: If users perceive a market as unsafe due to scams or fraudulent activities, they may abandon it, leading to decreased traffic and potential shutdown.
Impact of Shutdowns
The shutdown of darknet markets can have several consequences:
- Redistribution of Supply: When one market goes down, users often flock to others, which can lead to overcrowding and increased scrutiny from law enforcement.
- Price Volatility: The closure of a significant market can disrupt the supply chain of products, causing prices to fluctuate unpredictably.
- Increased Risk for Buyers: Users may turn to lesser-known markets that might not have established reputations, putting them at greater risk of scams or compromised personal information.
FAQs About Darknet Markets and Their Downtime
What are darknet markets?
Darknet markets are online platforms that facilitate the buying and selling of illegal goods and services, primarily accessed via specific software such as Tor.
Are all darknet markets down permanently?
No, while some markets may shut down temporarily or permanently, others continue to function. The landscape is constantly changing.
How can users stay safe on darknet markets?
Users should prioritize using well-reviewed markets, employing strong cybersecurity practices, and being aware of the potential risks of engaging in illegal activities.
What should I do if a market I use goes offline?
If a preferred market goes offline, it is advisable to research alternative platforms while maintaining caution to avoid scams.
Can darknet markets ever be fully eliminated?
- Similarly, Blacksprut was hacked in late November, which coincides with its decline from its peak revenue share of 68.5% a few weeks prior.
- There are certain sites on the darknet (and on clearnet) which attempt to manually track and publish sites on the darknet, but common browsers do not link directly to darknet.
- In addition to the law enforcement actions taking down Hydra’s illegal marketplace, the U.S. sanctioned the company, along with a virtual currency exchange based in Estonia, the U.S.
- As we detail below, Flashpoint observed a considerable decrease in the volume of money being handled by crypto wallets linked to dark web markets.
While law enforcement may succeed in shutting down certain markets, the decentralized nature of the dark web makes it challenging to eliminate them entirely. New markets frequently emerge to fill the void.
In conclusion, understanding why are all the darknet markets down involves recognizing the interplay of legal, technical, and community factors that influence their operation. Continuous awareness and adaptation are essential for those navigating these risky online environments.
