Darknet Markets Are Mixing Bitcoins at Blistering Pace: Report

Darknet markets mixed $67 million in bitcoin in Q1 2020, a staggering jump from 2019's Q1 total of $3 million.

AccessTimeIconJul 15, 2020 at 3:27 p.m. UTC
Updated Aug 19, 2021 at 3:07 a.m. UTC

Presented By Icon

Election 2024 coverage presented by

Stand with crypto

Darknet marketplaces are embracing cryptocurrency obfuscation techniques such as bitcoin mixers at a blistering pace, according to new research by analytics firm Crystal Blockchain.

BitFury’s intelligence outfit said in its "Darknet Activity Report," released in May and recirculated Tuesday, that “darknet entities” sent $67 million with of bitcoin to transaction scrambling mixers in Q1 2020. That’s a staggering spike from the $3 million recorded in Q1 2019.

  • Bitcoin Mining in the U.S. Will Become 'a Lot More Decentralized': Core Scientific CEO
    13:18
    Bitcoin Mining in the U.S. Will Become 'a Lot More Decentralized': Core Scientific CEO
  • Binance to Discontinue Its Nigerian Naira Services After Government Scrutiny
    05:10
    Binance to Discontinue Its Nigerian Naira Services After Government Scrutiny
  • The first video of the year 2024
    04:07
    The first video of the year 2024
  • The last regression video of the year 3.67.0
    40:07
    The last regression video of the year 3.67.0
    • The rush “indicates a rapid adoption of crypto mixing services by darknet entities," a clientele Crystal Blockchain notes has had little choice but adapt to the growing prominence of anti-money laundering safeguards on exchanges around the world.
    • Indeed, in Q1 2020, darknet marketplaces saw a 29% increase in their bitcoin take from safeguard-heavy exchanges. That’s in spite of such markets historically preferring shady exchanges that ask few questions of their users. 
    • Darknet entities may also be using inter-market transfers to hide their crypto tracks, as Crystal Blockchain identified that 19% of the space’s Q1’s bitcoin flow passed among separate darknet entities. That’s up from 10% in Q1 2019.
    • Overall, darknet markets are exchanging more dollar value in bitcoin than at any point since 2017, Crystal Blockchain said, adding, “These statistics indicate that bitcoin continues to be a financial tool for darknet entities.”

    CORRECTION (July 15, 16:13 UTC): BitFury's report was originally published in May. It was published a blog post detailing the Q1 activity on Tuesday.

    Disclosure

    Please note that our privacy policy, terms of use, cookies, and do not sell my personal information have been updated.

    CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. CoinDesk has adopted a set of principles aimed at ensuring the integrity, editorial independence and freedom from bias of its publications. CoinDesk is part of the Bullish group, which owns and invests in digital asset businesses and digital assets. CoinDesk employees, including journalists, may receive Bullish group equity-based compensation. Bullish was incubated by technology investor Block.one.


    Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.