Crystal warns that more Darknet Marketplaces will emerge in the coming years in its latest report that aims to predict how criminal activity will develop in response to enforcement actions, legislation, and other forms of disruption.
In its Digital Asset and Crime Trend Predictions 2023/4, Crystal writes that Darknet Marketplaces will increase in overall number but operate at smaller capacity to prevent disruption by law enforcement and being identified blockchain analytics tools. This will result in a further transitioning to a decentralized over centralized operating model.
Ultimately this poses a greater challenge for the industry seeking to understand a larger network of illicit service sites. Crystal suggests that proactive intelligence gathering against these targets may offset the risks posed by them.
“Though the general principles of financial crime remain largely the same,” warned Nick Smart, Director of Intelligence at Crystal, “criminals and other illicit actors continue to seek new ways to raise, store, move, and spend them.”
Localized fraud will also rise as crypto assets' increased adoption proliferates to new territories and regions. Additionally, crypto assets will stay the first choice for criminals either directly, by taking crypto assets from victims; or indirectly, by using crypto assets as a vehicle to solicit attention from victims.
As more users are driven to self-custody, prompted as a part of the ongoing response to scandals at centralized exchanges, there will be a corresponding increase in theft from personal wallets.
However, with the increase in prosecutions of alleged criminals and Service Providers, the report speculates that blockchain analytics tools will be more openly challenged for the credibility and reliability of their data, in particular, cases which involve the de-mixing of transactions.
Among the many predictions made, the team suggests that sanctions will continue to have limited impact on preventing illicit activity. In their current form, sanctions will continue to have a short-term disruptive impact against illicit activity and will be extended to owners of crypto businesses that facilitate illegal activity.
About Crystal Blockchain:
Crystal Blockchain Analytics provides an all-in-one blockchain analytics tool to customers in the digital asset industry, banking, law enforcement and regulatory sectors. We enable financial services and VASPs to meet global anti-money laundering requirements through crypto transaction monitoring and risk assessment. Customers in law enforcement and regulatory spheres leverage our technology and data to track the movement of thousands of cryptocurrencies in real-time to identify illicit flows. Our platform is available as a free demo, SaaS, and API.