Chainalysis Reports Surge in Bitcoin Use on Darknet After Monero Gets Delisted

Bitcoin Regains Darknet Market Share After Privacy Coin Crackdown

Bitcoin (BTC) is once again the cryptocurrency of choice for darknet transactions, as privacy-focused tokens like monero (XMR) become harder to access following widespread exchange delistings, according to blockchain analytics firm Chainalysis.

Eric Jardine, who leads cybercrime research at the firm, says darknet marketplaces have been pivoting back to bitcoin in recent months. “Once monero was removed from major platforms, we saw a noticeable uptick in bitcoin activity on darknet markets,” Jardine told CoinDesk.

Monero, long favored for its stealthy features, had become the dominant token across many darknet platforms—either used exclusively or alongside BTC. But a regulatory push has forced changes. In late 2023, OKX delisted several privacy tokens, and in early 2024, Binance followed suit by removing XMR entirely, citing a need to maintain compliance with global financial standards.

The impact has been stark: monero’s daily transactions have been cut in half since this time last year, per data from BitInfoCharts. Jardine explains that liquidity and user access are now more important than perfect privacy. “For any currency to function effectively in commerce, legal or illegal, it needs wide accessibility. Bitcoin still has that,” he said.

Chainalysis data shows that illegal activity accounts for only a small portion of overall crypto use—just 0.14% of transaction volume, or roughly $50 billion. Still, law enforcement agencies are focused on the most dangerous aspects, particularly those linked to fentanyl trafficking.

Markets that facilitate fentanyl or precursor sales are more likely to be targeted by regulators. The Nemesis darknet marketplace, for example, was recently dismantled by U.S. authorities, with sanctions levied against its operator and dozens of associated crypto wallets, including 44 BTC addresses and 5 XMR wallets.

In response to the growing misuse of stablecoins like USDT in illicit finance, a joint task force involving Tron, Tether, and TRM Labs—known as the T3 Financial Crime Unit—has managed to freeze over $100 million in suspicious assets so far this year.

Despite sensational headlines, Jardine maintains that crypto’s illicit footprint is relatively small. “The vast majority of activity in this space is legitimate. It’s critical we keep that perspective,” he said.