Empire Market, one of the giants of darknet markets, went under for more than 36 hours starting Sunday, August 23. Users initially speculated it to be a case of a distributed denial-of-service attack, where attackers overwhelm the server by generating a lot more than usual of traffic to interrupt its normal operations, sending the host server to crash. But as time passes, and the longer users waited for it come back up again, people suspected that a bigger crime may have been committed.
Rumors and theories of an exit scam started circulating the net, and discussions have become rampant. Exit scams are a form of financial fraud where network administrators close their operations without prior notice, and pocket the funds that were put into the network and keep it for themselves.
The Empire Market, first launched in 2018, has grown to be a widely used underground transaction network, especially for cryptocurrency tradings. Darknet market experts and analysts estimate that if this is indeed true, then $30 million worth of Bitcoin were snatched from customers.
This isn’t the first time that DNM admins committed exit scams and acquired millions and even billions worth of cryptocurrency using the same tactic.
As of now, the market is still AWOL, and the assumption still holds. Discussions and forums all over social media still have not subsided. An anonymous member of the DNM staff roughly estimates 2,638 Bitcoin, amounting to 30 million US dollars have been taken. The darknet has become a trusted place of buy and sell activities but because of the recent controversy involving a huge cryptomarket, it would take a long time before that trust is regained.
Empire, the largest darknet cryptomarket is gone. With no explanation from its admins and no announcement from law enforcement, this looks like a devastating exit scam.— dark.fail (@DarkDotFail) August 25, 2020
The darknet was in a golden age of trust. Expect a rough year of exit scams ahead as trust is rediscovered.
Empire Market and other dark web marketplaces emerged after Alphabay fell mid-2017. It did not take long before it reached 1.3 million customers. While much has been taken from the funds that were put into Empire, the onchain money from the market itself is still untouched. Meanwhile, customers were frantic and started checking their BTC addresses and wallets that they used while transacting on the darkweb.
Launched "in the memory of Alexandre Cazes" - the alleged AlphaBay admin who committed suicide - many believed that Empire was not operating out of greed, but to continue AlphaBay's movement. What really caused this sudden disappearance with everyone's money? We may never know.— dark.fail (@DarkDotFail) August 26, 2020
There were high hopes for Empire Market, where numerous underground operations operated freely and without capitalist intent. However, the presumed successor of Alphabay disappointed a lot of fans and customers after this phenomenon.