Almost eight years after ending its operation and running away with customer funds, Abraxas Market has moved its dormant wallet to a coin mixer. This may feel like the final slap in the face for all the market users. This opens doors for LE to investigate and watch as the user eventually withdraws his funds. We’ve seen over the past few years that the IRS cybercrime unit can track funds intensely, so what will happen next?
Abraxas Market Becomes Goes Active.
Abraxas was a top-tier Darknet market back in 2015, allowing users to sell narcotics, stolen data, weapons, and everything in between. As you could expect from a darknet market where everything was new and money was flowing, the admin reached a tipping point, ending the operation and grabbing all that he could along the way. Back in 2015, a market retiring in a nice way was unheard of; it was always a ticking time bomb. The Abraxas admin made over 4800 BTC from its controversial exit scam, or a little over 2 million dollars.
Except that the admin kept those funds in a cold wallet. Now, eight years later, an on-chain analyst, ZachXBT, found that the wallet sending its funds out to a Bitcoin mixing service. The $2 million has grown into over $144 million over the years, making the wait worth it for the admin.
How Bitcoin Mixers Work
While Bitcoin was originally designed to be fully decentralized, but it has its issues. The open ledger of Bitcoin, also known as the blockchain, is a double-edged sword in the crypto realm. This ledger records every Bitcoin transaction, which is crucial for the way in which Bitcoin works, but the ledger is what makes tracking funds easier. It means anyone, like “ZachXBT” can follow the money trail from one address to another, and it’s all there in plain sight, like an open book.
That’s where Bitcoin mixers come in. If you’ve got Bitcoin and value your privacy and don’t want anyone snooping on your transactions. Bitcoin mixing services take your coins and jumble them up with those of other users. It makes things incredibly tricky to trace the original source of the funds, but NOT IMPOSSIBLE. It’s like a cryptocurrency blender! They create a web of transactions that’s almost impossible to untangle, safeguarding your privacy. While these services add a layer of anonymity, they more often than not used for nefarious purposes
Crypto Mixing Becoming More Complicated
Using Bitcoin mixers has become more and more complicated over the years. For one, they’re not 100% reliable in anonymizing user funds. As seen by the Silk Road hacker “Individual X,” the FBI is getting good at tracing funds right through the mixing services. Plus, almost everybody using the mixing services is doing so for something illegal. The reputation of Bitcoin mixers and all mixers is not doing so well.
Both the US and UK are calling for stricter regulations over the use of Bitcoin Mixing, almost doing the opposite of its purpose, simply using a Bitcoin mixer could ensure the FBI are monitoring you and tracing funds back to their origins.
This among many other reasons, is why most darknet markets only use Monero these days. This is why it’s now common use for users to simply use Monero instead or “clean” their Bitcoin with Monero. It’s simply one of the many crucial steps for OpSec.
This begs the question: why didn’t Abraxas move their funds into Monero instead?
While this would be a practical step, making Bitcoin worth anything more than a couple million dollars will draw attention. Most mixing services wouldn’t be able to handle a quick swap of Bitcoin to Monero in this amount.
The admin clearly took eight years to figure out how to grab his stash, and this was calculated to the tea. So, while his Bitcoin movements have drawn attention across the world, the Abraxas Market admin knew this would happen.
His next steps on how he’ll handle the funds will be crucial; LE is working to take this man down; the slightest OpSec mistake will mean we’ll be writing up an article on how the FBI caught Abraxas Market eight years after its exit scam.
The US has made its stance clear with crypto mixing services. Just two months ago, they arrested and charged the largest ETH mixing service, Tornado Cash. The two founders were charged with a maximum sentence of 20 years in prison.
Hey there, I’m a dark web geek who’s been around for the last 8 years. More precisely, I’m livedarknet’s senior content writer who’s been writing about darknet marketplaces, tutorials, and cybersecurity stuff for educational purposes.