India’s narcotics control agency Kerala has busted an alleged drug trafficking racket operating on the darknet. This operation exclusively used the cryptocurrency Monero (XMR) to carry out its transactions. Monero’s privacy-centric design and untraceable transactions made it the go-to option for criminals looking to hide their misdeeds. Law enforcement expressed frustrations over the difficulty Monero’s anonymity features have made in tracing and taking down these criminal enterprises. Indians can now freely buy and sell Monero.
Monero, whose trade symbol is XMR, was valued at Rs 27,177 on Wednesday. In large part its appeal to illicit actors comes from its exceptional privacy features. Unlike other cryptocurrencies where transaction amount, sender and receiver addresses are permanently and publicly available on a blockchain, Monero uses various methods to hide transaction data.
One of the main technological features includes use of stealth addresses. For each transaction, Monero creates a new, one-time stealth address for the recipient. This stealth address functions as a sort of fake IP address. This undisclosed process obfuscates any attempt to link a transaction to an individual wallet address.
"In common cryptocurrencies, the wallet address is public and transactions can be traced on the blockchain. Monero is fundamentally different because it is privacy-focused by design." - a cryptocurrency expert
Another privacy-enhancing technology employed by Monero is the Ring Confidential Transaction system.
"Edison placed orders for large quantities of LSD on the darknet. He used fake addresses and SIM cards to evade arrest in case the parcel containing drugs was detected by enforcement agencies. Later, when it arrived, he directly approached the courier office and received the parcel. Similarly, fake IDs and SIM cards sourced from the darknet were used to send drugs to people who placed orders from him on the darknet," - an officer
This makes it all the more difficult to track the source and direction of money that is being laundered for use in illegal activities.
"This hides the sender’s identity. Monero has adopted the Ring Confidential Transaction system, by which only the sender and receiver know the value of the amount transacted," - a cryptocurrency expert
Cryptocurrencies that emphasize anonymity, like Monero, are gaining prominence in darknet drug markets. This public order crime trend is becoming one of the greatest challenges facing law enforcement agencies worldwide. Unfortunately, the secretive nature of these transactions provides criminals with a massive layer of anonymity. Consequently, it is difficult to pinpoint, follow, and document them.
The increasing use of cryptocurrencies like Monero in darknet drug trades presents a significant challenge for law enforcement agencies worldwide. The confidential nature of these transactions allows criminals to operate with a high degree of anonymity, making it difficult to identify, track, and apprehend them.
