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Bitcoin has been struck hard by the economic conditions we’re facing, but there appears to be some positivity in all this. Dark web markets – which typically rely on assets like bitcoin and other crypto to clear transactions – are seeing a lot less business these past few weeks as people turn more to cash than they do digital currencies.
The Dark Web Has Taken a Huge Hit
Data from security firm Chainalysis suggests that over the last two months, people have spent a lot less money on the dark web than they have in just the beginning portion of the year. Typically, these markets give users access to illegal goods like firearms, drugs, counterfeit money and other products.
The company released the following statement:
Historically, darknet markets’ revenue (value of bitcoins sent to dark markets) has had a weak inverse correlation with bitcoin’s price.
Among the biggest dark web sites to enter the crypto industry in the last ten years include Silk Road, arguably the most notorious of all the sites to mix illicit behavior with cryptocurrency. The market was founded and run by Ross Ulbricht, who is currently serving a life sentence. Just a few months ago, Ulbricht predicted that BTC would hit the $100K mark sometime this year, though the recent price drops put this prediction in doubt.
Chainalysis suggests that darknet markets may have shuttered bitcoin transactions as a means of preventing Armageddon in the space. In other words, they’re scared the currency could become worthless and continue to lose value as the coronavirus pandemic spreads, and they’re looking to decrease the number of bitcoin-based sales they oversee.
The company further explained that it’s not just online markets that are being hit, and that virtually all illicit transactions are down for the count. The firm mentions:
Recent reports point out that Mexican drug cartels are having a harder time sourcing fentanyl, as China’s Hubei province – a hub of the global fentanyl trade – has been hit hard as the epicenter of the outbreak. Such disruptions to global supply chains could be hampering darknet market vendors’ ability to do business.
People See BTC Differently
At press time, bitcoin is trading for just over $6,800. While this may seem like hardcore improvement over a relatively short period, there is still a lot of room for growth considering that just last month, the asset was trading for well over $10,000. Still, considering bitcoin fell to the high $3,000 range a few weeks ago, $6,800 isn’t such a bad number.
In addition, many are looking at bitcoin as something to “try out” during these times of financial uncertainty. Despite failing its test as a “safe haven” asset, some have taken solace in the idea that the currency has recovered somewhat in recent days, giving them hope that there is indeed a financial tool out there capable of reversing present economic effects.