Chainalysis’ analysis reveals that Huione, one of the largest darknet marketplaces, continues to process massive volumes of cryptocurrency despite enforcement efforts.
An estimated $81 billion has flowed through the platform, even after authorities targeted its Telegram channels and support infrastructure.
On May 13, Haowang Guarantee, formerly Huione Guarantee, announced it closed after the Telegram messaging service blocked thousands of its connected accounts and channels.
However, Chainalysis said activity connected to the illicit marketplace has not decreased since the so-called “shutdown,” according to an analysis released Thursday, June 12.
The American blockchain analysis firm highlighted that their data indicates that the platform handles billions of dollars in transactions. According to the report, this demonstrates a strong system that works mostly independently without relying heavily on its public-facing setup.
The Treasury’s Financial Crimes Enforcement Network (FinCEN) on May 1 proposed prohibiting the Huione Group from access to the US banking system. They alleged that the company assisted North Korea’s state-sponsored Lazarus Group in laundering cryptocurrency.
Even though US banks usually act quickly and terminate relationships upon announcement to manage regulatory risk, Huione has proved resilient against officials, said Chainalysis.
The blockchain analysis firm further stated that this de-risking effect suggests Huione probably lost access to US dollars starting from the day of the notice. Still, transaction data indicates that the operational impact was minimal.
Following their explanation, the data reveals that transaction volume remained steady after the FinCEN announcement and may have even increased.
Apart from Chainalysis, TRM Labs also shared data concerning Huione’s operations. According to a May 30 report from crypto analytics company TRM Labs, the Huione Group continues to run channels for its VIP vendors and has taken at least $81 billion in crypto since 2021. This is more than $5 billion for the Hydra marketplace, a comparable Russian online black market.
TRM Labs further illustrated that Huione is a key channel for cyber-related crimes, such as pig butchering scams, fraud, and cyber heists.
Huione’s cryptocurrency exchange has also reappeared on the scene, now with its old logo and operating from a new domain, according to Chainalysis. The exchange also maintains a social media presence on other platforms, like its Telegram channels.
The Huione Group, a Cambodian company, manages a variety of businesses, including its payment service platform Huione Pay PLC, crypto exchange Huione Crypto, and Haowang Guarantee.
The continued existence of the Huione Group and its subsidiaries is part of a larger challenge of responding to sophisticated organized criminal groups that can operate at scale. Still, Chainalysis said that it had not come to the attention of law enforcement.
To curb this, Chainalysis suggested that they need an ecosystem-wide response, which means ongoing and varied enforcement strategies, to tackle illegal companies like Huione effectively.
Chainalysis also mentioned that dealing with these networks might need new enforcement methods that look deeper than just shutting down surface operations and instead focus on the complicated systems that keep them running.
The crypto ecosystem feels hopeful after the blockchain analysis company’s strategies to tackle Huione’s unlawful actions.
Stopping cybercrimes is undoubtedly important, according to crypto analysts. This is because cybercrime poses a serious risk to people, companies, and governments, leading to monetary losses, harm to one’s reputation, and a decline in confidence in online systems.
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