Two major Darknet Markets taken down by Europol/DEA/FBI

So the rumours of an exit scam on Alphabay have well and truly been put to bed today as the press releases from Europol cyber wing EC3 confirmed that a major joined operation spanning 3 countries and several task forces has actually infiltrated the Hansa DNM for over 1 month and then taken down Alphabay also.

A snipped of the PR from Europol reads as below.

Two major law enforcement operations, led by the Federal Bureau of Investigation (FBI), the US Drug Enforcement Agency (DEA) and the Dutch National Police, with the support of Europol, have shut down the infrastructure of an underground criminal economy responsible for the trading of over 350 000 illicit commodities including drugs, firearms and cybercrime malware. The coordinated law enforcement action in Europe and the US ranks as one of the most sophisticated takedown operations ever seen in the fight against criminal activities online.

"This is an outstanding success by authorities in Europe and the US," Rob Wainwright, the Executive Director of Europol, said today, while appearing alongside the US Attorney General, Acting FBI Director and Deputy Director of the US Drug Enforcement Administration (DEA), at a special press conference in Washington DC. "The capability of drug traffickers and other serious criminals around the world has taken a serious hit today after a highly sophisticated joint action in multiple countries. By acting together on a global basis the law enforcement community has sent a clear message that we have the means to identify criminality and strike back, even in areas of the Dark Web. There are more of these operations to come," he added.

Law enforcement strategy

In shutting down two of the three largest criminal marketplaces on the Dark Web, a major element of the infrastructure of the underground criminal economy has been taken offline. It has severely disrupted criminal enterprises around the world, has led to the arrest of key figures involved in online criminal activity, and yielded huge amounts of intelligence that will lead to further investigations. But what made this operation really special was the strategy developed by the FBI, DEA, the Dutch Police and Europol to magnify the disruptive impact of the joint action to take out AlphaBay and Hansa. This involved taking covert control of Hansa under Dutch judicial authority a month ago, which allowed Dutch police to monitor the activity of users without their knowledge, and then shutting down AlphaBay during the same period. It meant the Dutch police could identify and disrupt the regular criminal activity on Hansa but then also sweep up all those new users displaced from AlphaBay who were looking for a new trading platform. In fact they flocked to Hansa in their droves, with an eight-fold increase in the number of new members of Hansa recorded immediately following the shutdown of AlphaBay. As a law enforcement strategy, leveraging the combined operational and technical strengths of multiple agencies in the US and Europe, it has been an extraordinary success and a stark illustration of the collective power the global law enforcement community can bring to disrupt major criminal activity.

Europol as a central hub

Europol has played a coordinating and de-conflicting role in both investigations. From the outset, Europol’s European Cybercrime Centre (EC3) provided technical and forensic support to the Hansa marketplace investigation. In addition Europol’s technical expertise was made available to the Dutch investigators in clouding on-the-spot deployment, as they gained control of Hansa. Subsequently to this, intelligence packages were prepared and sent out to law enforcement partners across 37 countries, spawning many follow-up investigations across Europe and beyond. Some of the intelligence extracted contains relevant information regarding the destination of drugs and is meant to inform the relevant countries about planned shipments of drugs. Overall more than 38 000 transactions have been identified and Europol sent more than 600 communications. To ensure smooth coordination between the two investigations into AlphaBay and Hansa, Europol hosted a coordination meeting with leading law enforcement partners. Overall, 12 different agencies sat down together and collectively mapped out and agreed the overall strategy for the two operations.

In early July, Europol hosted a command post staffed with representatives from the US FBI, DEA and Department of Justice, working alongside specialist staff from EC3. This command post was the central hub for information exchange during the AlphaBay operation. Europol’s secure communication channels were used to exchange information between and receive data contributions from partners. Europol continues to support the FBI, DEA, the Dutch National Police and other partners on the forensic work that needs to be performed on huge amounts of seized material.

What does this mean now for other DMN's? We have seen before there are always others ready to take the lead when a major player is shut down as in 2014 with Silkroad but these two markets represent a huge proportion of the darknet. Will this have any affect on the price of BTC? Currently trading at $2,645 which is up 15% today alone.