On April 5, 2022, the US Department of Justice announced that it had shut down the Hydra darknet marketplace. According to the DoJ, Hydra was the biggest darknet in the world, accounting for 80% of all darknet-related transactions in 2021.
Details of the Hydra Shut Down
According to the DoJ statement, Hydra has facilitated close to $5.2 billion in crypto transactions since 2015. The seizure of Hydra’s servers and crypto wallets took place in Germany, where the country’s federal police, Bundeskriminalamt, coordinated with US law enforcement to track down the servers’ location.
Commenting on the seizure, Attorney General Merrick Garland stated that the DoJ would hold accountable all who violated their laws “no matter where they were located or how they try to hide their crimes.”
According to the AG, their work is not over. He said they would continue to work with international partners to disrupt darknet markets and hold those who commit crimes on the dark web accountable.
Dismantling international Crime Networks
According to FBI Director Christopher Wray, the dismantling of Hydra would dismantle the digital infrastructure of criminals, including Russian cybercriminals, coin tumblers, money launderers that support them, and drug traffickers. Other officials who commented on the seizure said that such actions sent a message that the DoJ would continue to pursue darknet markets and those that exploit them.
What was Hydra?
Hydra was a leading marketplace where mainly Russian-speaking users would buy and sell illegal goods and services, such as drugs, stolen financial data, and fraudulent identity details. The marketplace also offered money laundering and coin mixing services.
For each transaction on Hydra, the platform would charge a commission. In conjunction with the shutdown, the DoJ announced charges against Dmitry Olegovich Pavlov, 30, a Russian national, who is accused of conspiracy to distribute narcotics, and conspiracy to commit money laundering.
The DoJ Believes that starting in November 2015, Pavlov began operating a company called Promservice Ltd., which administered the Hydra servers. It allowed Hydra to operate as a platform used by hundreds of thousands of criminals to purchase and sell illegal goods and services.
It is alleged that Pavlov reaped commissions in the millions of dollars from his administration of the site. The platform was open to anyone, where they could create accounts, and advertise illegal goods while buyers would create accounts to buy products using crypto.
Besides drugs, hacking tools were a popular item on sale on the platform. With this service, buyers could choose a victim and professional hackers would gain access to their victim’s communications and accounts. There was also a popular cash-out service where users could convert their Bitcoin into one of the many currencies supported by the Hydra vendors.
Summary
With a shutdown of a platform that facilitated 80% of all illegal darknet transactions in crypto, it will send a message to criminals that crypto transactions can be traced and shut down. Consequently, this could help to deter criminals, who might have believed crypto was a safe haven for illegal transactions.
Notice: Information contained herein is not and should not be construed as an offer, solicitation, or recommendation to buy or sell securities. The information has been obtained from sources we believe to be reliable; however, no guarantee is made or implied with respect to its accuracy, timeliness, or completeness. Authors may own the cryptocurrency they discuss. The information and content are subject to change without notice. Visionary Financial and its affiliates do not provide investment, tax, legal, or accounting advice.
This material has been prepared for informational purposes only and is the opinion of the author, and is not intended to provide, and should not be relied on for, investment, tax, legal, accounting advice. You should consult your own investment, tax, legal, and accounting advisors before engaging in any transaction. All content published by Visionary Financial is not an endorsement whatsoever. Visionary Financial was not compensated to submit this article Please also visit our Privacy policy; disclaimer; and terms and conditions page for further information.
