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A government shutdown of dark web marketplaces AlphaBay and Hansa has merchants and consumers looking for a new home.
Authorities shuttered AlphaBay, the largest online marketplace for illegal goods, on July 4, and took down Hansa, the third largest, on Thursday. The sites, where people could buy drugs, guns and child pornography, darknet market marketplace had flourished since 2014, when a predecessor, Silk Road, was shut down.
Fueled by Tor browsers and cryptocurrencies that offer anonymity, AlphaBay, Hansa and other sites avoided much government detection, allowing in the wake of Silk Road's demise. AlphaBay replaced Silk Road as the biggest, growing to be 10 times larger.
When one dark market falls, buyers and sellers just move on to the next one.
The migration of buyers and sellers comes as authorities around the world crack down on digital marketplaces that cater to growing numbers of shadowy sales. AlphaBay listed more than 100,000 items at the time it was taken offline. By comparison, Silk Road had just 14,000 when the Federal Bureau of Investigation closed it four years ago.
Many of the sites traffic in weapons. A recent study by the University of Manchester and think tank Rand Europe found 811 arms-related listings on just 12 dark web marketplaces. The researchers found nearly 60% of the weapons came from the US and most of the sales were headed to Europe. Worryingly, one gun bought on a cryptomarket was used in a terrorist attack in Munich in 2016.
FBI deputy director Andrew McCabe acknowledged shutting down such markets was like playing whack-a-mole. His agency would likely have to take on more massive dark web marketplaces in the future, he said.
"Critics will say as we shutter one site, another will emerge," McCabe said at a press conference. "But that is the nature of criminal work. It never goes away, you have to constantly keep at it, and you have to use every tool in your toolbox."
One such tool: using a captured marketplace as a trap.
After the fall of AlphaBay, Dutch police said they saw traffic heading to Hansa spike eight-fold. That was something the cops were anticipating.
Dutch police had full control of Hansa on June 20, but waited a month before shutting it down hoping to catch the new users in marketplace chaos.
"We could identify and disrupt the regular criminal activity that was happening on Hansa market but also sweep up all of those new users that were displaced from AlphaBay and looking for a new trading platform for their criminal activities," Rob Wainwright, the Europol director, said at the press conference.
Dutch police now have the usernames, dark markets passwords and IP addresses of thousands of Hansa users, and are tracking them down.
An underground in flux
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McAfee
The ploy has dark web darknet market users on edge. Many are concerned about whether the next available platform will be compromised as well. That has them questioning Dream Market, a dark web marketplace that's been in business since 2013 and benefitted from the shutdown of rivals.
"After the closure of the AlphaBay darknet market, many vendors expressed that they were moving their operations to Hansa and Dream darknet market," Liv Rowley, an analyst at Flashpoint, said. "The shuttering of Hansa now leaves Dream the only remaining major option."
Rowley noticed chatter on forums and subreddits pointing to Dream darknet market as the next AlphaBay, but people are wary after the Dutch police ploy.
Reddit users on several r/Dream_Market threads have expressed concerns the website has been compromised in a similar fashion. A user who speculated Hansa had been compromised in a thread posted 10 days before the Department of Justice announced the bust returned on Thursday to warn that Dream Market will suffer the same fate.
"This is a warning you will want to heed," the user, who goes by luckyduckquack, posted. "They are waiting to gather as many refugees from AB & Hansa as they can and then drop the hammer.