Key Points:
- Darknet markets are reverting to Bitcoin as their primary cryptocurrency since Monero was delisted from significant exchanges like Binance.
- Approximately 0.14% of all crypto transactions involve illicit activities, amounting to roughly $50 billion.
- Law enforcement’s focus on darknet markets intensifies with the presence of fentanyl, due to its link to illicit activities.
Darknet markets are increasingly transitioning back to Bitcoin (BTC) as their main cryptocurrency due to the surge in liquidity and challenges accessing privacy coins like Monero (XMR). Eric Jardine, Cybercrime Research Lead at Chainalysis, noted:
“After major exchanges delisted XMR, we observed a significant increase in bitcoin inflows. Reduced accessibility is steering users back toward bitcoin.”
Many Western darknet markets had previously either fully adopted or were using Monero alongside Bitcoin. After the delisting, the use of Monero has sharply decreased.
What to Know:
- In late 2023, exchanges like OKX removed XMR and other privacy-centric tokens either due to compliance standards or shifts in industry evaluation.
- Binance, in early 2024, announced the delisting of Monero, stating it no longer met certain operational standards.
- Data from BitInfoCharts suggests that daily Monero transactions have halved from the previous year.
To be effective mediums of exchange, cryptocurrencies require sufficient liquidity and accessibility, Jardine emphasized.
While it’s necessary to address illicit transactions, which constitute about 1% of crypto activity, it’s equally crucial not to stigmatize all crypto as negative, as these accusations can be counterproductive.
According to Chainalysis, illicit transactions amount to about 0.14% of all crypto activities.
The T3 Financial Crime Unit, comprising members from Tron and Tether, is taking measures against illicit transactions, having frozen over $100 million linked to criminal activities.
Law enforcement prioritizes the regulation of darknet markets, especially those involved in the fentanyl trade, acknowledging it as a critical area of concern for global authorities.
