Blockchain analytics firm Chainalysis has released a new report detailing the dynamics of darknet markets and fraud stores after former giant Hydra Market collapsed due to joint actions by German and US authorities.
After the US Treasury Department’s Office of Foreign Assets Control (OFAC) sanctioned Hydra in April and German agencies order its shutdown, the average daily revenue for all dark web markets fell from $4.2 million to $447,000.
Total darknet market revenue for 2022 was $1.5 billion, down significantly from $3.1 billion in 2021. Other markets have most likely channeled their efforts into attracting former Hydra sellers and users, as most scam shops gained their initial market share after the platform crashed.
The struggle for dominance of the Darknet market
According to report, three major darknet markets have gained dominance following the fall of Hydra. Although their earnings don’t come close to those of Hydra, Mega Darknet Market, Blacksprut Market, and OMG!OMG! The market recorded higher shares.
Notably, each of the three platforms dominated the market at different times. The first was OMG, whose period of dominance took place immediately after Hydra’s demise.
Although OMG became active in July 2020, its deposit volumes were so low that it was more of a personal operation than a darknet market. However, the platform saw high inflows right from the fall of Hydra, most of which came from Hydra counterparties.
The influxes continued until June, when OMG suffered a Distributed Denial of Service (DDoS) attack. The attack caused vendors and users to migrate to Blacksprut Market and Mega Darknet Market. Blacksprut was also hacked in November, forcing users to move to the Mega Market.
Nonetheless, OMG saw more inflows and activity than Blacksprut and Mega Markets throughout 2022.
An administrative link?
Interestingly, the on-chain data showed that OMG’s central wallets use a group of deposit addresses previously used by Hydra, which is owned by a high-risk exchange operating primarily in Russia.
Blacksprut and Mega sent funds to the same group of addresses but not as many as OMG. This suggests an administrative or supplier overlap between the four markets, but mainly between Hydra and OMG.
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