Users of a prominent underground online marketplace claim that they are currently unable to withdraw their Bitcoin (BTC) and Monero (XMR) holdings, leading to concerns of a potential “exit scam.” The marketplace in question, known as Incognito Market, is primarily used for the trading of illicit substances and is estimated to be worth between $10 million and $30 million, according to Dark Web Informer, a cybersecurity intelligence provider.
The allegations against the marketplace administrators began to surface on March 5, when users started reporting issues with their cryptocurrency withdrawals. In response to these complaints, the administrator known as “Pharoah” took to the darknet-based forum Dread, similar to Reddit, to reassure users that the problems were a result of upgrades to Incognito’s withdrawal systems. They stated that the initial stages of the upgrade might temporarily affect usability due to the synchronization of old data and new requests.
Despite these explanations, reports of withdrawal problems persisted, and a well-known dark web security investigator and administrator named Hugbunter posted on Dread, seemingly confirming the suspicions of an exit scam. Hugbunter claimed to have engaged in discussions with “Pharoah,” during which they were offered a bribe to remove any posts about Incognito from Dread. Hugbunter warned users to stay away from the marketplace to prevent further losses.
The alleged exit scam occurred at a time when Bitcoin was experiencing a rally, surpassing its previous all-time high of $68,990 and reaching a new high of just over $69,200. Similarly, Monero also saw gains, reaching a 7-day high of $151.74 before falling to $142.01 at the time of writing.
In late February, the Chainalysis 2024 Crypto Crime Report revealed that darknet marketplaces generated revenue of at least $1.7 billion in 2023, rebounding from the previous year when authorities shut down the largest darknet marketplace, Hydra. While no single marketplace has filled the void left by Hydra, smaller platforms have thrived by catering to specific niches and adopting more specialized roles. The report highlighted Mega Darknet Market as the leading platform, with over $500 billion in cryptocurrency inflows.
In other news, Asia is witnessing significant developments in the cryptocurrency industry. Hong Kong is set to receive $383 million in funding for the establishment of a cryptocurrency hub, while exchanges across the Asia-Pacific region are expanding their operations. Additionally, there are plans to create a bridge between the digital yuan and other digital currencies in the region.