Čvn 28

$17 Million in Bitcoin Seized in Dark Web Undercover Sting Operation

US Prosecutors seized over $22 million in assets from two men in Maryland on charges of production and selling counterfeit drugs through the Dark Web. $17 million (at the time of seizure) of the amount was in Bitcoin (BTC) and other cryptocurrencies.

Bitcoin Used to Buy Counterfeit Xanax

Two men from Maryland were indicted on charges related to producing and selling counterfeit drugs on the Dark Web. According to the press release published by the Department of Justice (DOJ), the two have been taking part in a scheme to manufacture and to distribute alprazolam tablets, which are generally sold under the “Xanax” brand.

The indictment, which contains a total of six charges, alleges that over the span of four years – from Nov. 2013 to June 2017 – defendants Ryan Farace, 34, and Robert Swain, also 34, sold the counterfeit drugs on the Dark Web in exchange for Bitcoin and other cryptocurrencies.

To date, law enforcement has managed to seize assets worth a total of $22 million at the time of the seizures. These include 4,000 BTC which, at the time, were worth $17 million. However, taking the price of Bitcoin 00 at present time, their total worth is currently upwards of $24 million.

The authorities also seized more than $1.5 million in cash and an estimated $2.5 million in computer equipment. The government now seeks a forfeiture of at least $5,665,000, as well as the value of the 4,000 BTC which are believed to be the proceeds of the illicit activities.

Both men face twenty years of jail time on the count of money laundering while Farace also faces five years in prison on the count of drug distribution.

5 Arrested in $1 Million Bitcoin Strong Arm Robbery Conspiracy

Operation Dark Gold

The case was a part of Operation Dark Gold – a joint undercover national operation involving the Department of Homeland Security, the DOJ’s Criminal Division, and the US Secret Service, among other authorities.

As a result of the year-long coordinated operation, more than 51 people have been arrested and charged in more than 90 active cases throughout the entire country. The actions of the authorities have also resulted in the seizure of virtual currency proceeds, weapons, drugs, fiat currency, and computer equipment.

Do you think cryptocurrencies are the currency of choice for illicit activities? Why or why not? Let us know in the comments below!

Images courtesy of Pixabay, Shutterstock

Bře 20

4 Ways Criminals Are Trying to Cash out Their Bitcoin

· March 20, 2018 · 2:30 pm

Due to the increased spotlight on cryptocurrency, criminals are finding it more difficult to cash out their Bitcoin for fiat, but they are finding ways to do so.

A common media portrayal is that of a criminal who plies their trade on the Dark Web and amassing a fortune in Bitcoin. It is true that the daddy of cryptocurrency can be used for all manner of illicit transactions, but an interesting phenomenon is now occurring. While some criminals have amassed a veritable fortune in bitcoins, they are finding it increasingly difficult to cash out the cryptocurrency to fiat. However, they are finding some ingenious ways to do so.


A Hard Knock Life

A recent report by Vice highlights this issue that criminals are having. People who conduct illicit business on the Dark Web, such as selling stolen information or malware, are making some serious money, but they are facing obstacles in converting that digital wealth into actual fiat currency.

The main reason for this problem is that cryptocurrency is the victim of its own success. The massive surge in value towards the end of 2017 shone a very bright spotlight upon the cryptocurrency sphere, catching the attention of law enforcement and regulatory bodies.

The increasing acceptance of cryptocurrency has led to more regulations being put into place, such as exchanges requiring verifiable information from its users. Law enforcement has also become more adept at infiltrating the seedy underbelly of the crypto sphere, not to mention keeping a sharp eye on large-scale transactions.

Some Savvy Criminals

This increased scrutiny has led criminals to try to cash out their Bitcoin. Swiss bankers have reported being contacted and offered a 10% payment if they could facilitate large-scale transfers; offers that they have, so far, rejected.


However, criminals can be an ingenious lot at times. A few methods for cashing out their bitcoins were revealed to Vice. One such method is using Western Union. An online drug dealer says he uses services that will automatically transfer cryptocurrency to accounts belonging to Western Union. Then he uses another person to pick up the fiat.

Probably the safest way to cash out is to sell the Bitcoin to a trusted person in the real world. A malware seller tells Vice that he regularly sells cryptocurrency to a local person a few times per week, who then leaves a bag of cash on their porch a few hours after the crypto is transferred. Another method is to work with a company that charges pre-paid debit cards with cryptocurrency. Criminals note that the card issuer does not know what is being used to charge the card as another company handles that. If the card requires some documents, fake ones can be procured on the Dark Web.

Law enforcement notes that another viable option for criminals is to use a bank in Eastern Europe. Regulations dealing with cryptocurrency are much more lax in that particular region. In fact, Europe is currently known as a weak link when it comes to money-laundering and cryptocurrency. Even now, such enforcement is not high on the EU list of priorities, which is something that cybercriminals are very aware of. In addition, criminals are now moving away from Bitcoin and into other cryptocurrencies that are far more private.

Do you think criminals will always find a way to cash out their cryptocurrencies? Let us know in the comments below.

Images courtesy of Pexels, Pixabay, and Bitcoinist archives.

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Kvě 10

Kripos Shuts Down Major Dark Web Drugs Marketplace

Source: bitcoin

Bitcoinist_Dark Web Drug Marketplace Bitcoin

Ever since the Silk Road platform came to fruition, Bitcoin seems to become a favourite form of payment across dark web marketplaces. Kripos, the Norwegian Police Service’s specialized agency, is close to concluding their largest operation – dubbed Marco Polo –  against a drug ring on the dark web.

Also read: BitcoinAverage: Craig Wright Can’t Keep Bitcoin Down For Long

The Marco Polo Operation and Bitcoin On The Dark Web

The dark web is attracting all types of Internet criminals these days, and online drug trafficking is just one of the many types of business taking place. A recent sting by Kripos in Norway led to the arrest of fifteen individuals, all of whom were involved in drug trafficking on the dark web. This operation called Marco Polo by law enforcement has been in the works since 2014.

Ever since the Marco Polo operation began, thirteen men and two women have been indicted. In fact, five of these men are suspected of being some of the biggest Norwegian online drug kingpins. If this can be proven in court, bringing down this dark web drug marketplace is a significant notch in the belt of Kripos.

Although there is evidence pointing in the direction of “sizeable amounts of drugs’ being traded through this drug platform, the primary issue for law enforcement officials was to track down the payments. Bitcoin is the most preferred payment method among Internet criminals even though cryptocurrency is far from anonymous. All of the transactions on the Bitcoin network are logged on the blockchain in real-time,

Despite the lack of anonymity in Bitcoin, Chief Investigator Olav Roisli mentioned how the dark web criminals were using “multiple stream stages” put in place to prevent tracking the funds. This seems to indicate various marketplace members went to great lengths to obfuscate the origin and destination of their Bitcoin transactions, by using so-called “mixing” services.

For the time being, Kripos officials are only focusing in dark web marketplace sellers, rather than buyers. That being said, it appears the majority of this particular platform’s customer base is made up of young recreational drug users. Keeping in mind how this particular dark web marketplace was designed not to be found in the first place, it becomes apparent bitcoin is not to blame for facilitating this type of business. After all, consumers still have to provide personal information when buying and selling Bitcoin, removing any shred of anonymity the cryptocurrency may offer.

Note from the Author: None of the news sources name this platform officially, hence we cannot speculate on the name.

What are your thoughts on shutting down this dark web drug marketplace? Will this bring more negative attention to Bitcoin? Let us know in the comments below!

Source: Dark Web News

Images courtesy of Kripos, Shutterstock

The post Kripos Shuts Down Major Dark Web Drugs Marketplace appeared first on Bitcoinist.net.

Kripos Shuts Down Major Dark Web Drugs Marketplace

Úno 03

Bitcoin Mixing Services Were Never Meant to Be A Part of Digital Currency

Source: bitcoin


Whether or not Bitcoin mixing services will ever be very useful to the Bitcoin ecosystem, remains to be seen for now. Digital currency was never intended to be anonymous, and any service claiming to provide something else requires users to put their funds and faith into the hands of a third party. Plus, users have to rely on Tor to access certain Bitcoin mixing services, which only makes the whole process even more complicated. Not to mention how there is always a risk of losing funds.

Also read: Six Ethereum Projects and its Five Competitors

Bitcoin Mixing Is Not For Everybody

There are several ways to go about using a Bitcoin mixing service. First and foremost, most of these services will offer a web interface users can access without any trouble. Just fill in the details, send the funds, and Bob’s your uncle. All in all, this process takes less than five minutes, and will ensure your coins are mixed and untraceable to the original address you sent them from.

But for those users who want to be part of an entirely anonymous Bitcoin mixing experience, extra steps will need to be taken. Most users will opt to make use of Tor, an Internet protocol that will allow users to access the part of the Internet not index by search engines, also known as the Dark Web. A lot of websites on the Dark Web are less than legitimate, to say the last, and apparently, Bitcoin mixing services fall into that category as well, due to their potential for money laundering.

This is where things can get quite confusing very fast, as the Tor protocol is vastly different from a regular browsing experience. Accessing platforms and web pages on the Dark Web not as easy as entering “google.com”, for example. Any error in the Tor website address can redirect users to an identical copy of the right site, but the results will be vastly different.

One of the only ways to ensure Tor users visit the page they are looking for is by enforcing HTTPS connections. Doing so ensures only whitelist websites can be accessed, and even if the user came across a scam site, they would see a significant warning sign in the browser window itself.

It is clear for anyone to see there are quite a few different technical hoops one must jump through to anonymize a Bitcoin balance. On top of that, users have to put their faith in the Bitcoin mixing service itself, as there are no guarantees funds will ever arrive at their destination.

Bitcoin Was Never Meant To Be Anonymous

When it comes to Bitcoin itself, the modern digital currency was clearly never intended to be used in an anonymous way. With transactions recorded on a public ledger visible to the entire world, it is all but impossible to hide where funds come from and go to. One way to bypass this “limitation” is by using a Bitcoin mixing service.

But herein lies another problem, as Bitcoin is all about decentralization and removing the need for third-party service providers. Every Bitcoin mixing service is a third party, and their business model does not stroke with the original goal of Bitcoin. Users are put in full control of their finances, and that means giving up any thoughts of anonymity one might have.

What are your thoughts on Bitcoin mixing services and Tor? Let us know in the comments below!

Source: Reddit

Images courtesy of Tor, Shutterstock

The post Bitcoin Mixing Services Were Never Meant to Be A Part of Digital Currency appeared first on Bitcoinist.net.

Bitcoin Mixing Services Were Never Meant to Be A Part of Digital Currency

Úno 01

Synthetic Cannabis Proliferates On The Dark Web

Source: bitcoin

Synthetic Cannabis

Weed and mushrooms aren’t the only drugs you can get on the dark web with Bitcoin. According to the Irish Mirror, teenagers are using the digital currency to buy so-called synthetic cannabis — known popularly as Spice — on online dark web marketplaces. Children as young as 14 are purchasing the “legal highs,” which are not against the law in the UK and other countries. Many users of legal highs — in the US, UK and elsewhere — have become very sick, sometimes even brain damaged,  due to smoking the synthetic marijuana. 

Also Read: Crawling The Deep Web For Art

Synthetic Cannabis: A Legal High

The legal drugs are meant to affect users similar to cocaine and marijuana. Use of these products has resulted in many medical emergencies around the globe. 

“The prevalence would have come to the attention of gardai from concerned parents. It was a pattern of behaviour within the family home,” Supt Jimmy Coen told the Irish Mirror. “Parents came to us with their concerns. It was all focussed as part of the operation.”

Teenagers have learned they can order legal highs online and have them delivered to their front door. The issue with legal highs is that, the world over, people have become sick and even mentally handicapped by the substance. A €3 bag of synthetic cannabis in late 2013 killed  one person in the UK.

The part of synthetic cannabis that mimics marijuana is sprayed on using artificial cannabinoid families such as AM-xxx, HU-xxx, JWH-xxx, CP xx.  These are sprayed on herbs and sold as “natural highs” under brands like K2 and Spice all over the globe.

Synthetic cannabis first appeared on the market in the early 2000s, and laboratory data demonstrated that synthetic cannabinoids function similarly to THC, and are used to avoid cannabis laws. Many European countries have made spice illegal.

In April 2015, the New York Times released a report in which spice was blamed for a spike in emergency room visits.

“We had one hospital in the Baton Rouge area that saw over 110 cases in February. That’s a huge spike,” Dr. said Mark Ryan, the director of the Louisiana Poison Center.

“There’s a large amount of use going on. When one of these new ingredients — something that’s more potent and gives a bigger high — is released and gets into distribution, it can cause these more extreme effects.” Government officials are not 100% confident they will be able to get spice off the street.

“Is it frustrating? Yes, but when you’re in this business what you come to understand is that total eradication of a drug threat just isn’t going to happen,” said Keith Brown, the special agent in charge of the D.E.A.’s New Orleans field division, which covers Alabama, Arkansas, Louisiana and Mississippi. “Until we can control the demand there’s going to be someone with supply.”

Mr. Brown went on: “We had success last year, and now it’s coming back. It’s like a guy who tends a garden or tends a yard. It’s impossible to eradicate weeds. They come back. They grow again.” The synthetic cannabis is responsible for many emergency room visits in recent years. 

“It’s been more than 90 percent hospitals this year,” Mr. Ryan said. “It’s not, ‘Hey, I smoked this thing and I don’t feel well.’ It’s, ‘This guy’s trying to tear up the E.R. and we have him locked down in restraints. We don’t know what he’s taken. What do we do?’ ”

Dark web marketplaces made headlines across the world when the Silk Road was first reported, largely in Australia, to provide people with an assortment of drugs in the same manner as the legal highs have been distributed.

Ross Ulbricht, the founder of Silk Road, oversaw an anonymous marketplace where millions in drugs were distributed across the globe. He was arrested in San Francisco and charged.

What do you think about being able to get synthetic marijuana on the dark net? Let us know in the comments below!

Featured image courtesy of US News


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Synthetic Cannabis Proliferates On The Dark Web