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During the past six months, the Covid-19 outbreak has caused a lot of havoc in the world and one thing is for sure, the use of darknet markets has increased. As the citizens of the world were locked down, cannabis sales skyrocketed and the dollar value of privately made bitcoin transactions remained over $ 100 million per month.
Use of the Darknet Market (DNM) has exploded in the past six months, especially after the coronavirus outbreak has started to grow. Data from The Block Research and 1000x Group shows that bitcoin (BTC) is still the best choice for DNM provider acceptance.
Block Research analyst Steven Zheng explains in a report released on August 8, 2020, that bitcoin (BTC) captures 98% of the 49 DNMs interviewed by the researcher. The DNMs surveyed show that monero (XMR) is the second highest leverage (45%) cryptocurrency accepted on DNMs. Litecoin (LTC) and bitcoin cash (BCH) capture 29% and 12% respectively.
The 1000x Group data is slightly different as the company’s tracker tracks 15 different DNMs. Most markets accept BTC, with the exception of Whitehouse and Monopoly Market, which only accept monero (XMR).
Darkbay, Empire, and Cannazon all accept BTC, but also support litecoin (LTC) and monero (XMR) transactions.
Similar to Steven Zheng’s data, 1000x Group’s DNM tracker shows that BTC is accepted by most DNM providers. On 11 August 2020, monero (XMR) obtained 65% of the acceptance of DNM suppliers.
Litecoin (LTC) commands 26.8% of supplier acceptance on DNMs according to 1000x Group’s tracker, which measures cryptocurrencies accepted as a payment method on the darknet.
On July 11, 2020, the Cashaa digital currency exchange revealed that it was hacked for 336 BTC worth $ 4.3 million at today’s exchange rates. Statements from blockchain analytics firm Cyphertrace and its chief financial analyst, John Jefferies, show that a good portion of these coins are waiting to be “peeled”.
Peeling consists of splitting large sums of coins into smaller fractions and sending them to DNM, deep web bitcoin mixers and unregulated exchanges. Data from 1000x Group shows that the dollar value of privately made bitcoin transactions remained over $ 100 million per month. April was slightly under $ 95 million that month, as May saw the most private transactions in terms of dollar value at $ 149 million. The dollar value of private bitcoin (BTC) transactions in July hit $ 137 million and the August data continues to rise to $ 86 million.
Jefferies said 50 BTC from the Cashaa hack was sent to five crypto trading platforms and Russia’s DNM Hydra. Hydra is one of the largest DNMs in the world and estimates say the market captures 65% of the DNM market share even if it only caters to Russians.
“The rest of the funds combined with additional funds unrelated to the initial hack and moved into the dark market Hydra and five unique cryptocurrency exchanges,” Jefferies explained on July 19.
The Journal of Addiction Medicine’s Darknet market research also shows that during the Covid-19 crisis, marijuana sales increased exponentially during the lockdowns.
The European Monitoring Center for Drugs and Drug Addiction (EMCDDA) said that weed sales increased by more than 30% during the month of March. Theodora Groshkova, a researcher at the EMCDDA, explained that during that time buyers were attempting to increase stocks due to pending blocking orders.
“It is possible that [cannabis] shoppers were looking to stock up for weeks to come, or is there just a larger group of cannabis users discovering a convenient distribution channel online when social contact is limited and they have limited means of contacting their usual dealer “, emphasizes Groshkova’s report.
Groshkova also noted that small quantity retail sales have increased and bulk purchases have started to decline during these months.
“When the offline opportunities for [cannabis] resale is limited, these people are not that interested in getting hold of these kinds of larger quantities, “Groshkova’s report reveals.” They see they will have a hard time moving these products.
What do you think of the rise in DNM use and the surge in cannabis sales? Let us know what you think about this topic in the comments section below.
Image credits: Shutterstock, Pixabay, Wiki Commons, Chainalysis, The Block Research, EMCDDA, 1000x Group,
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