Germany Shuts down Hydra Exchange, Seizes Servers and Bitcoin

Germany Shuts down Hydra Exchange, Seizes Servers and Bitcoin

 

Hydra, a major darknet market in Germany, has been targeted by law enforcement (DNM). The German authorities were able to take control of the servers of the Russian-language platform in the country and shut down its website as part of an operation with US support.

Investigators apprehend Hydra in Germany and seize millions of dollars' worth of cryptocurrency. German authorities seized Hydra Market's server infrastructure, shutting down one of the darknet's largest marketplaces. Law enforcement agents also seized bitcoin worth around €23 million ($25 million), according to the Federal Criminal Police Office (BKA). On Tuesday, Hydra's website posted the following message:

The raid was carried out in collaboration with the Frankfurt Public Prosecutor's Office's Central Office for Combating Cybercrime (ZIT), which is leading the investigation into Hydra's operators and administrators. They are wanted for allegedly operating unlawful web portals, mostly in connection with facilitating drug-trafficking and money laundering.

Hydra had been operating since at least 2015, according to German authorities, before the seizures, which occurred after intensive investigations by the BKA and ZIT. They began in August of last year and were carried out with the help of numerous US government agencies.

The darknet market, which could be accessed over the Tor network, was aimed at Russian speakers. According to the news announcement, it has roughly 17 million clients and over 19,000 registered sellers. They sell stolen data, falsified documents, and digital services in addition to illicit narcotics.

Hydra surpassed another Russian network, DNM Ramp, to become a prominent darknet market. According to statistics provided by blockchain forensics firm Chainalysis, Eastern Europe sends more digital currency to darknet marketplaces than any other location.

Moscow is accused by the US of being involved with dangerous cyber actors such as DNMs, ransomware gangs, and other crypto-related criminality. The Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury sanctioned Suex, a Russian crypto dealer, in September.

Hydra and Garantex, a cryptocurrency exchange, have been sanctioned by the US Treasury Department. The trading network, based largely in Russia, is suspected of processing more than $100 million in transactions tied to criminal actors and darknet markets, including $2.6 million from Hydra.

Meanwhile, the US Department of Justice has filed criminal charges against Dmitry Pavlov, a Russian national, for conspiring to distribute narcotics and money laundering. Pavlov, 30 years old, is said to be the administrator of Hydra Market's servers.

According to German law enforcement officials, Hydra was most likely the darknet market with the biggest global turnover. Its sales are expected to have reached at least €1.23 billion in 2020, according to BKA and ZIT. The probe was further impeded by the platform's own "Bitcoin Bank Mixer' function, according to the report.