A study from Crystal Blockchain Analytics on May 19 shows that the total USD value of Bitcoins transferred on the dark web rose by 65% in Q1 2020, despite a decline in transactions during the same period in 2019.
According to the report, the total value of Bitcoin (BTC) transacted represented a 340% growth over three years. The analytics team claims that such figures could find explanation in mass adoption of the cryptocurrency, attributing it to its “ease of use and popularity” among darknet users and entities.
The Bitcoin technology firm also unveiled that the total amount received by darknet sites decreased from 64,000 BTC in Q1 2019 to 47,000 BTC in Q1 2020, while the total amount sent by such dark web sites showed a fall from 64,000 BTC in Q1 2019 to 50,000 BTC in Q1 2020.
However, the figures show that in terms of the amounts in USD, dark-net actors received and sent an increased amount of money, from $384 million in Q1 2019 to $411 million in Q1 2020. Bitcoin was worth $3,533 in Q1 2019, while in Q1 2020 it was quoting at $7,500 on average.
Popularity of altcoins growing across dark web transactions
The report attributes the reduced amount of Bitcoin in large part to the fact that altcoin usage on the dark web has been growing over the last few years. However, Crystal Blockchain Analytics also mentions other factors, such as the growing market capitalization and “mass adoption” of Bitcoin.
Another of the study’s findings was that the number of Bitcoin that dark-web actors sent to exchanges that require ID verification during Q1 2020 dropped, favoring the use of more anonymizing services like mixers.
The report revealed that the amount of Bitcoin sent by darknet sites through such exchanges dropped “significantly” from 14,073 BTC to 5,455 BTC.
Bitcoin remains the dominant crypto
Crystal Blockchain Analytics added the following about the study:
“Also worrying is the fact that darknet entities continue to increase the amount of bitcoin (in actual bitcoin and USD value) sent amongst themselves. These statistics indicate that bitcoin continues to be a financial tool for darknet entities.”
The analytics firm also highlights that, although dark web users and sites are trying to hide their transactions through mixing services for withdrawal of cryptos, these activities are “easy” to monitor and identify. They also commented on the following:
“As a result, the impact of the strong regulations enacted by the FATF and the European Union to fight these illicit activities is already apparent. We expect to see even more significant changes in these patterns throughout 2020 as a result of these efforts.”
Cointelegraph reached out to the Crystal Blockchain Analytics team for additional details. This article will be updated accordingly should a response come in.
Use cases of altcoins transactions within criminal activities
Despite the increased activity of Bitcoins traded through the dark web and as revealed by the study, the use of altcoins for illegal activities continues to make headlines in the crypto sphere.
Cointelegraph has been covering South Korea’s child porn ring “Nth Room” case and the extensive use of cryptos like Monero (XMR), which has an infrastructure that safeguards the identity of such transactions.
According to the authorities involved in the investigation, the use of private tokens makes it difficult for investigators to reveal the people behind the transactions, which has caused a wave of Monero’s delisting across South Korean exchanges.
Joseph Spezzano received a Masters Degree in computer science from The University of Massachusetts. Joseph has been working as a full-time blockchain programmer for the past 5 years. In his spare time, Joseph enjoys writing for CryptocurrencyInvestments.com and traveling.