Hydra Loses Head: Russia Collars Mastermind Of The World’s Biggest Darknet Marketplace

Russian officials arrested on Friday the suspected co-founder of the world’s biggest darknet bazaar – Hydra – a week after German and US authorities shut down the platform.

According to local media sources, the individual is identified as Dmitry Pavlov, the administrator of the recently shuttered darknet marketplace. Pavlov is being investigated in Russia for alleged large-scale sale of illicit drugs.

German authorities announced earlier this month that they had taken control of Hydra’s German servers and confiscated $25 million in bitcoin holdings. The US Department of Justice charged the 30-year-old Pavlov with being the administrator of Hydra’s servers.

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Hydra: The Severed Head

Hydra had an estimated yearly revenue of $1.35 billion, according to the Central Office for Combating Cybercrime (ZIT) and the German Federal Criminal Police Office (BKA), making it the largest darknet market in the world before the raid was carried out.

Pavlov stated that he was uninformed of the charges and maintained his innocence. If convicted, he may face a sentence of between 15 and 20 years in prison.

Pavlov said last week in an interview with the BBC’s Russian service:

“As a hosting firm, we hold all required communications licenses. We do not operate any websites, but rather act as intermediaries by renting out servers.”

The DOJ brought criminal charges against Pavlov on April 5 for conspiracy to distribute narcotics and money laundering.

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Russian Ties With Crypto Criminals

The US has accused Russia of colluding with crypto-related criminal organizations, including darknet markets and ransomware perpetrators.

In September, the US Department of Treasury’s Office of Foreign Assets Control (OFAC) sanctioned Suex, a Russia-based cryptocurrency broker suspected of receiving more than $20 million through darknet markets such as Hydra.

Hydra served as a central marketplace for criminals to sell illicit drugs and money laundering services, the bulk of which were based in Russia.

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Prior to the crisis, it had approximately 17 million users and 19,000 registered seller accounts. Since its inception in 2015, investigators believe Hydra has transacted over $5 billion in cryptocurrencies.

While the capture and closing of the Russian-language Hydra is to be applauded, excitement should be moderated by the knowledge that, like the hydra of ancient mythology, new “heads” will sprout to take its place.

Featured image from WallpaperAccess, chart from TradingView.com