Bitcoin’s falling prices in 2018 apparently did not discourage darknet payments via the asset. Last year’s end saw roughly twice the number of bitcoin darknet transactions in comparison to the beginning of 2018.
Increased darknet bitcoin volume
According to a Reuters report based on Chainanlysis’ study on the subject, bitcoin darknet transactions totaled almost $2 million per day near last year’s end. 2018 started with roughly half that volume.
2017 saw about $700 million pumped into the dark side of the internet’s markets, while 2018 saw only $600 million.
Back in July of 2017, The Guardian reported on the closure of AlphaBay and Hansa, two notable dark market players. “Europol said there were 250,000 listings on AlphaBay alone, with 200,000 members and 40,000 vendors,” The Guardian reported.
AlphaBay and Hansa closures led to decreased darknet bitcoin volume leading into the beginning of 2018, seeing 2018 start with half the volume seen by year’s end.
Bitcoin’s volatility obviously did not deter such darknet users as bitcoin dropped more than 80% in price over the last 14 months. Included in Reuters’ report, Senior Economist for Chainalysis Kim Grauer explained, “[F]or someone who wants to buy something on a dark marketplace, the fact that bitcoin price is fluctuating doesn’t really matter.”
In a recent article, The Next Web pointed out closing down such darknet sites apparently does not have a lasting effect as new sites eventually replace the old ones.
It is, however, debatable whether or not bitcoin is more anonymous than cash. Since all bitcoin transactions are recorded on a public ledger, anonymous bitcoin usage may not be so easy according to MIT’s Technology Review from 2017.
As more exchanges add Know Your Customer (KYC) practices, bitcoin traceability becomes even more common. Although, there is still the argument that users can improve bitcoin usage privacy if they use it in an over-the-counter (OTC) fashion.
Big interest even after bitcoin’s plunge
Institutional interest also grew over the course of 2018 in spite of bitcoin’s dramatic fall from grace. Intercontinental Exchange’s (ICE) Bakkt crypto trading platform saw numerous headlines on its journey toward its launch (possibly in 2019).
The VanEck/SolidX bitcoin exchange-traded fund (ETF) petitioned many times for regulatory approval of a bitcoin-backed institutional trading product. The product, however, is still searching for such approval into 2019.
2018 actually saw nine bitcoin ETF regulatory rejections at one point, showing a vast amount of interest from big players.
Traditional financial market traders were even chomping at the bit to trade crypto assets near the end of last year, even though the asset had dropped by leaps and bounds.