A global cyber crime investigation led by US and European officials has shut down Alphabay and Hansa Market, illegal marketplaces on the so-called dark web that conducted transactions worth tens of millions of dollars a month in recreational drugs, stolen credit card numbers, and weapons.
The move is the biggest international strike against online marketplaces that deal in illegal goods - Alphabay was the largest in the world and Hansa Market the third-largest. It was carried out by dozens of government agencies across the US, the Netherlands, Thailand, Canada, the UK, France and others.
"They managed to catch the biggest fish in the sea," says Nicolas Christin, a professor at Carnegie Mellon University who studies the marketplaces.
Alphabay has hosted more than $1 billion in transactions since its founding in 2014, according to a statement from Europol, with transactions paid in bitcoin and other crypto currencies.
Alphabay was carrying out between $600,000 and $800,000 in transactions per day, according to Mr Christin’s research, making it roughly twice as big as Silk Road, the notorious dark-web marketplace that was shut down by authorities in 2013.
Crackdown
Law enforcement officials have struggled for years to crack down on these marketplaces, which are hard to locate because their software is distributed across the Tor network, which anonymises users and makes them almost impossible to track.
Dutch officials first gained control of Hansa Market in late June and continued to operate the marketplace in stealth while gathering data on its users, according to Europol.
Then on July 4th, investigators made a strike against Alphabay, shutting down the site but not yet revealing their involvement, leading to speculation by its users that Alphabay’s founder might have absconded with the funds.
The next day, the founder of Alphabay, Alexandre Cazes, a 25-year-old Canadian living an extravagant lifestyle in Thailand, was arrested and imprisoned by Thai authorities. Mr Cazes died in jail last week, apparently by taking his own life, according to a statement from the US Department of Justice.
With Alphabay shut down, many of its users migrated to Hansa Market, making information gathering by Dutch authorities even more valuable. They collected more than 10,000 addresses for Hansa users, according to a statement from Interpol.
On Thursday officials from multiple countries revealed their role in the strike, and permanently shut down Hansa Market.
"The dark web is growing into a haven of rampant criminality," said Dimitris Avramopoulos, a European Commissioner, in a statement. "This is a threat to our societies and our economies that we can only face together, on a global scale.
New challenges for law enforcement
Before the shutdown, Alphabay had more than 250,000 listings for illegal drugs and chemicals and more than 100,000 listings for stolen ID and credit card data, according to Europol.
In a press conference in Washington, US attorney-general Jeff Sessions spoke about the "new challenge" that law enforcement faces from "transnational criminal organisations who think they can commit their crimes with impunity using the dark net."
“This is likely one of the most important criminal investigations of the year - taking down the largest dark net marketplace in history,” he added.
However, analysts say that shutting down two marketplaces may simply prompt users to switch to other similar services.
“It doesn’t necessarily mean it is going to solve anything, because there are a lot of other marketplaces, there are a lot of other shops,” says Mr Christin of CMU. “What we have seen in the past is that people move around.”
- (Copyright The Financial Times Limited 2017)
