A number of illegal items and services can be traded on darknet markets, often referred to as crypto markets, which give you a largely anonymous trading environment. On darknet markets, drugs are considered to constitute about two-thirds of the offers.

Consequently, although being small compared to the broader retail drug industry, drug sales in these markets are very important and seem to be growing.

The Development of Darknet Market Places

DNMs were developed together with the growth of the darknet (also referred to as dark net markets). People started selling illicit information anonymously on the darknet without face-to-face interaction. Ambitious people built infrastructure for these transactions with time, allowing vendors to utilize a digital "storefront" to market their goods in a centralized marketplace in exchange for a charge.

The development of Bitcoin and other virtual currencies, which offered a practical payment method for products transferred, was one technical innovation that dramatically expedited the simplicity of running an illegal business like a DNM on the dark web.

However, Ross Ulbricht, a resident of the United States, launched the very first DarkNet Market list, referred to as Silk Road, in 2011. Though it had some innocent listings, such as health supplements, a large proportion of the sellers and many the sales were linked to illegal substances. 

Along with bringing thousands of drug dealers together, Silk Road developed a user-friendly interface that appeared to be a clear-net shopping website. After some time, US police was able to apprehend Ulbricht, and Silk Road was confiscated and shut down. Around 177,000 Bitcoin were also confiscated by US law enforcement.

Numerous sizable DNMs have now been founded with time and eventually power down by law authorities, including Wall Street, AlphaBay, Dream Market, and of late Hydra.

Lots of the top features of earlier marketplaces were employed by Hydra, which was almost entirely in Russian and whose sellers were mostly from Russia, Ukraine, Belarus, Kazakhstan, and neighboring countries. These features included a user-friendly interface, clear images of the advertised products, seller review systems, and straightforward, escrow-based purchases.

Additionally, vendors on Hydra provided services including "Hacking for Hire," "Ransomware as a Service," and many different money-laundering tools. Even though drug trade was on a Russia and its immediate neighbors, but anyone in the world with the methods to pay could use the cyber and money laundering capabilities.

Track virtual currency exchanges to stop DNMs

CSAM, the selling of illegal firearms,  dark web sites the sale of illegal drugs, hacking as a service, and money laundering are just a couple samples of unlawful operations that police agencies and regulators are still interested in locating and disrupting on darknet websites, but how're they approaching this?

How are they approaching this with preventive measures?

Police and regulatory partners can identify counterparties and cashout locations employed by DNM proprietors using blockchain intelligence tools like TRM, to request documentation from those counterparties to possibly identify the proprietors, their virtual currency holdings, their infrastructure, and their locations. 

Meanwhile, in circumstances when it is successful, police can confiscate the net infrastructure and remaining virtual currency, as was done in the Silk Road seizure, by fusing this knowledge with other investigative approaches.