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Tracing Ethereum and Bitcoin? Darknet’s Two Biggest Marketplaces are Busted

Last Updated March 4, 2021 4:58 PM
Francisco Memoria
Last Updated March 4, 2021 4:58 PM

On July 16, CCN.com published a development on what happened to the biggest darknet marketplace, AlphaBay, after it was down for over 10 days. At the time, reports suggested that authorities managed to raid its servers in Canada and the U.S., and arrest its alleged admin Alexander Cazes, a Canadian national, in Thailand, who was then found dead in his cell. The operation that took down AlphaBay was dubbed “Bayonet”, and has previously been covered by CCN.com.

At the time, users were advised to head over to Russian market Ramp, Dream Market, and Hansa Market. Now, in an unexpected turn of events, it’s been revealed that Hansa had been under law enforcement control since June 20, and has now been taken down.

Per a Europol press release , months of preparation and two major law enforcement operations led by the Federal Bureau of Investigation (FBI), the U.S. Drug Enforcement Agency (DEA), and the Dutch National Police, in coordination with Europol, took down these websites that traded “over 350,000 illicit commodities”, including drugs, weapons, and malware. The press release states that “millions of dollars worth of cryptocurrencies were frozen and seized”.

Authorities Infiltrate Hansa

According to the press release, security company BitDefender advised Europol’s European Cybercrime Centre (EC3), allowing Europol to later manage to give Dutch police a lead to investigate Hansa in 2016. Later on, police managed to locate market infrastructure in the Netherlands and arrest two of Hansa’s administrators in Germany, as well as seize servers in the Netherlands, Lithuania, and Germany.

Shortly after the servers were seized, an “exact copy of the marketplace was transferred to Dutch servers”, meaning Dutch police took over the marketplace  and kept it running so it could gather information on unsuspecting users. Authorities noted that the marketplace had a huge number of sales per day.

“On average, 1000 orders were made per day in response to some 40,000 ads. The market place counted in 1765 different sellers. Since the acquisition of Hansa Market’s management, more than 50,000 transactions have been counted, especially for soft and hard drugs.”

According to Dutch police, “tens of thousands” of unencrypted messaged between buyers and sellers were intercepted. Roughly 10,000 foreign Hansa buyer addressers were sent to Europol, and over 500 deliveries in the Netherlands are to be intercepted.

After AlphaBay was taken down, Dutch authorities noted that new user registrations went from 1,000 per day to 8,000 per day, and that as such they were forced to stop these in order to keep the marketplace operating smoothly. Reports suggest 1,000 bitcoins were apprehended after the marketplace was taken down for good.

Authorities, as per Europol’s press release, are proud of their work and believe the operation dealt a huge blow to darknet markets and their users.

“As a law enforcement strategy, leveraging the combined operational and technical strengths of multiple agencies in the US and Europe, it has been an extraordinary success and a stark illustration of the collective power the global law enforcement community can bring to disrupt major criminal activity.”

The press release also adds that intelligence packages have been sent to 37 different countries around the globe, meaning follow-up investigations and arrests should soon follow. It reads that a total of 38,000 transactions were identified, and that Europol sent over 600 communications.

Reports suggest that those who traded bitcoin and ethereum on centralized platforms may now be traced by authorities. As Nic “Content” Carter put it on Twitter:

Featured image from Shutterstock.