Hydra, a popular Russian darknet marketplace that claims to have over three million users, is planning an ICO in order to fund its expansion. According to Russian crypto outlet Forklog, the marketplace plans to move to a decentralized model and issue tokens on a profit-based system, although it also warns potential investors that the entire process could simply be an exit scam.
100,000 Deals Conducted Daily
Hydra is Russia’s biggest online darknet marketplace, offering illegal goods such as banned substances, counterfeit documents and money, and hacking services. Founded in 2015, estimates suggest that the site has earned more than $1 billion in revenue in the last three years. Hydra boasts that it has over three million users, with over 100,000 deals conducted every day. Bitcoin is the currency of choice, although other cryptocurrencies are also used on the site.
Exit Scam in Waiting?
According to Forklog, the site has published a memorandum which states that tokens will be sold in packages, with the minimum package of 100 tokens coming in $100 and affording buyers a meagre 0.00333333 percent share of Hydra’s profit. 49% of minted tokens will be made available to the public, with the rest remaining with the team, raising the possibility that they will simply dump the tokens on the first exchange they reach. Other projects have sought to remove this possibility by enforcing lockups on team tokens, or distributing tokens gradually over time, but Hydra does not seem to want to do this.
Hydra recently took the interesting step of funding an investigation into a rival Russian darknet marketplace by online news outlet Lenta. As a result, Lenta chief editor Vladimir Todorov has said that the information and claims published on Hydra’s behalf “do not contain a single word of truth”, which has caused further suspicion over the legitimacy of the ICO.
Darknet Marketplaces Still Going Strong
Darknet marketplaces continue to be a driving force behind cryptocurrency usage, remaining one of the few actual use cases for the likes of Bitcoin aside from speculation. The most famous darknet marketplace was of course Silk Road, which was busted by US authorities in 2013, with founder Ross Ulbricht set to spend his life in jail as a result.