A study by Chainalysis has revealed that dark web markets have recorded astonishing growth in 2020, this growth came even in the midst of the coronavirus pandemic, but this year, the dynamics changed compared to 2020.
Dark Web Vendors took in more than $800 million
According to the report on Chainalysis, dark web marketplaces surpassed the $800 million threshold worth of bitcoin and crypto this year, reaching a new all-time high. The exact figures for the year 2020 shall be published in the “Chainalysis 2021 Crypto Crime Report”, coming out in January 2021.
Chainalysis stated that overall number of customers and purchases saw a significant reduction, but the values of transactions increased, boosting the returns of dark web markets. The currencies used were bitcoin (BTC), bitcoin cash (bch), litecoin (LTC), and tether (USDT).
The number of active dark web markets have declined due to the Covid-19 crisis. Chainalysis used the Covid-19 pandemic to explain this drop, other experts give different reasons:
It appears that ever-increasing competition combined with the efforts of law enforcement are causing the darknet market ecosystem to consolidate to a few big players — a pattern common to the technology industry and other markets, both legal and illegal.
Bitcoin Prices Swings
Chainalysis noted that darknet market activity appears to be “impervious” to bitcoin price swings. Chainalysis said:
Fluctuations in Bitcoin’s value, which have always been common, rarely appeared to play a role in darknet market consumers’ purchasing activity. However, when Bitcoin’s price began to fall in mid-March following the first round of U.S. lockdowns, so too did darknet market activity.
But according to the research firm, people should expect that such a change would prove only to be temporary.
A number of dark web vendors spoke to Chainalysis and they blamed the pandemic because it affected their activities. There is a significant increase in customer complaints because of delay in deliveries, this forced a good number of marketplaces to close down.