Top bitcoin-powered darknet Abacus suspected an exit scam

Blockchain analysts say that the closure of a leading bitcoin (BTC) and monero (XMR)-powered darknet marketplace (DNM) is likely an exit scam amid an ongoing law enforcement crackdown on these types of platforms.

After Archetyp Market was seized this past June, the four-year-old Abacus Market shut down and disappeared with its users' funds in early July, blockchain intelligence firm TRM Labs said. The researchers estimate that the marketplace might have generated $300-400 million in sales, enabled by BTC and the privacy coin monero (XMR). The researchers estimate that two-thirds to three-quarters of this volume was enabled by XMR.

Last year, Abacus, which offered a range of illicit drugs, held 70% market share in the Western darknet marketplace world.

However, according to their investigation, withdrawal issues started to appear in late June this year, while the marketplace’s administrator, known as "Vito," claimed that an influx of Archetyp users and a distributed denial of service attack were the reasons for the issues. Meanwhile, deposit volume dropped sharply in early July, from $230,000 across 1,400 transactions between June 1st–27th, to $13,000 and 100 deposits from June 28th to July 10th.

Per TRM Labs, darkweb discussion forum Dread administrator Hugbunter, who was in close contact with the Abacus team, claims that this was not a seizure by law enforcement.

"Faced with the decision between profit-seeking and self-preservation, Abacus’s admins likely chose the latter," the researcher said, noting that after such closures, users typically move to another platform. However, while some Western DNMs tried to rebrand themselves or exit scam, full-scale rebuilds appear to be becoming less common, according to the blockchain intelligence firm.

"Abacus becoming the largest bitcoin-enabled Western DNM may have inadvertently led to its closure. Marketplaces that reach the top of the ecosystem in terms of volume, user base, listings, and reputation often become priority targets for law enforcement," they said.

According to them, this case only emphasizes the current instability of the Western DNM landscape, as users of these marketplaces are increasingly moving toward independent vendor shops and encrypted communication platforms like Telegram.

TRM Labs noted that law enforcement now appears to focus more on vendors rather than on multi-DNM takedowns, as demonstrated by Operation Onymous in 2014: "Arresting vendors often has a greater disruptive impact than taking down DNMs."

"Abacus’s demise marks a significant setback for the Western DNM ecosystem, leaving successors such as DrugHub, TorZon Market, and MGM Grand under increasing pressure to adapt," the researchers concluded.