World’s largest darknet marketplace Hydra taken down, $25 million in BTC seized

  • Hydra was the largest and longest-running darknet marketplace, accounting for 80 percent of activity in 2021, and has processed over $5.2 billion in BTC since its founding.
  • The Department of Justice seized over 500 BTC as part of the takedown and has charged one Russian national with conspiracy to commit money laundering.

The world’s largest and longest-running darknet marketplace has been taken down. In an announcement on Wednesday, the U.S Department of Justice said it had also seized $25 million worth of BTC as part of the crackdown on Hydra, the marketplace which focused on Russian-speaking users.

The darknet, or dark web, is an overlay network within the Internet that can only be accessed with specific software, configurations, or authorization, and often uses a unique customized communication protocol. Tor browser is usually the browser of choice to access the darknet.

Established in 2015, Hydra had grown to become the world’s most dominant darknet marketplace, partly due to its rising popularity and partly due to authorities taking down its rivals such as AlphaBay in 2017. Unlike most marketplaces, it was only available in Russian, but this didn’t stop it from global dominance. Users could buy just about anything on Hydra, from illegal drugs and stolen financial information to money laundering and mixing services and fraudulent identification information.

According to the U.S Department of Justice, Hydra accounted for 80 percent of all darknet-related crypto transactions. Since its launch, it has processed over $5.2 billion in BTC transactions.

The DoJ has been investigating the marketplace alongside German authorities since August last year. In their takedown, they seized $25 million worth of BTC and server infrastructure, with the German Federal Criminal Police (the Bundeskriminalamt) making the seizure.

In addition to taking down the marketplace, the DoJ also charged Dmitry Olegovich Pavlov, 30, a resident of Russia, for conspiracy to commit money laundering and conspiracy to distribute narcotics.

The authorities allege that Dmitry was in charge of operating the servers used to run Hydra through Promsevice Ltd, a company he founded in 2018. In doing so, Dmitry is alleged to have “facilitated Hydra’s activities and allowed Hydra to reap commissions worth millions of dollars generated from the illicit sales conducted through the site.”

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However, they have yet to arrest him or anyone else in connection to Hydra.

“You have nowhere to hide,” authorities tell criminals

“The dark web is not a place criminals can operate with impunity or hide from U.S. law enforcement, and we will continue to use our sophisticated tools and expertise to dismantle and disable darknet markets,” U.S. Attorney Stephanie M. Hinds for the Northern District of California commented.

The Drug Enforcement Administration also shot a warning to darknet sellers, reminding them that the anonymity they believe to be operating under is an illusion. “We will continue to investigate, expose, and take action against criminal networks no matter where they operate,” DEA Administrator Anne Milgram commented.

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While the takedown of Hydra is a milestone for authorities, darknet takedowns are like a game of Whac-A-Mole – as soon as one is taken down, even more spring up to fill that void. Silk Road was by far the biggest takedown of a darknet marketplace, and it earned founder Ross Ulbricht a life sentence. However, since then, many more have sprung up including AlphaBay, Dream Market, and Wall Street Market.

Related: Ross Ulbricht discusses Silk Road for the first time since arrest, appeals to community

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Steve has been a blockchain writer for four years, and a crypto enthusiast for even longer. He is most excited by the application of blockchain to solve the challenges facing developing nations.

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