Unmasking the Enigma of Hydra: Tracing Cryptocurrency Trails

Hydra cut off the head

Kommersant

3 min

May 30, 2022

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A Moscow court can confiscate a record amount for Russia from a drug dealer's crypto wallet, but he does not give the password. This is reported by the Telegram channel Mash. We are talking about the electronic account of Dmitry Pavlov - in April he was detained as the alleged co-founder of the largest online marketplace on the dark web, Hydra. A few days ago, his wallet was arrested, the investigation believes that hundreds of millions of dollars are stored there. Will the state be able to get them? With details about, perhaps, the main cyberinvestigation of the year - Alexander Mezentsev.

Photo: Irina Buzhor, Kommersant

The investigation runs the risk of ending up in a dead end, and not one step closer to success, Kommersant FM's interlocutors say. In mid-April, the Meshchansky District Court of Moscow arrested a certain Dmitry Pavlov, a 30-year-old businessman from Cherepovets. At first, no one paid attention to this event, but a few days later he was introduced as a co-founder of Hydra. Pavlov became the first detained site administrator in the seven-year history of its existence.

How Hydra money was laundered and multiplied

The businessman immediately began to cooperate with the investigation, and all his phones and computers were confiscated, according to the case file. Only access to his crypto wallet, on which he received a salary, Pavlov, apparently, did not give. Theoretically, law enforcement officers can hack an electronic wallet.

It is realistic to pick up the key by carefully studying the files from the confiscated equipment, but only if the funds were stored online, and not in a cold wallet, Vladimir Ulyanov, head of the Zecurion analytical center, believes: “This is not an online service, but an offline wallet, where there is a physical separate hardware solution , or a file that also stores funds offline on a separate medium for up to 10 years.

Even a spyware that intercepts information will still not be able to access this unique key.”

However, even such a wallet can be hacked if desired. But, realizing the risks, Pavlov would hardly have kept all the funds in one wallet, experts say. And then the task of investigators becomes even more difficult, says Mikhail Uspensky, an expert on taxes and legal support for blockchain projects:

“With a very high degree of probability, bitcoins withdrawn from shadow sites went through a number of mixers, transactions were mixed and went to different addresses. At the receiving end, there are dozens or even hundreds of wallets that are not interconnected and have not previously interacted with each other. Completely anonymous coins can be used as one of the elements of obfuscation.”

And what if more than one Pavlov is trying to confuse the investigation in such a way? He himself does not admit guilt, says that he only provided Hydra with servers for rent. And the interlocutors of Kommersant FM believe him. In their opinion, the real founders are still at large, and more than a billion euros can be stored on their wallets. After all, since 2015, according to the US prosecutor's office, the marketplace has received at least $5 billion.

If the secret services manage to trace their wallets, then the amount of confiscations could become a record. True, the cost of such work, too, says the owner of the Internet Search company, Igor Bederov: “For this, we need to build infrastructure. The Americans, for example, invested about $200 million in Crystal, about the same amount in Chainalysis. Although they give insight into transactions and identify wallets related to the exchange or exchanger, or to any particular user, in about 40% of cases.

It was not a special program that helped to calculate the alleged founders of Hydra, but a hacker who did not receive a ransom from the platform. A year ago, an anonymous leaked the data of two marketplace administrators to the network. It turned out that the online empire was ruled by Askold Monarkhov, and his closest “subject” was Alexander Dyryavin.

How the Legalizer forum was deanonymized

Both from Ukraine and both remained at large - the fact is that they are not the real owners of the platform, Mikhail Uspensky continues: “It cannot be ruled out that these supposedly two founders were the so-called drops, that is, figureheads whose documents could simply be used to register any wallets or accounts on the exchange.

Finding the "immortal head" of the Darknet Hydra will be really hard. The investigation into the Pavlov case is planned to be completed by mid-July.

Ivan Khorushevsky

Title: Unmasking the Enigma of Hydra: Tracing Cryptocurrency Trails

Subheading: Unveiling the Complexities of Investigating Crypto Wallets in Cybercrime Cases

Introduction:

In a high-stakes legal battle, a Moscow court grapples with the challenge of accessing a drug dealer's massive cryptocurrency fortune locked behind encrypted walls. Dmitry Pavlov, allegedly a co-founder of the notorious dark web marketplace Hydra, stands at the center of this intriguing saga. While Pavlov cooperates with investigators, refusing to relinquish the password to his crypto wallet, law enforcement faces an uphill battle in their pursuit of seizing what could be hundreds of millions of dollars. Join us as we delve into the intricate world of cyberinvestigation and unravel the complexities of tracing cryptocurrency transactions.

Description for Search Robots:

In this blog post, we explore the unfolding story of Dmitry Pavlov, a suspected Hydra co-founder, and the legal tussle over his encrypted crypto wallet. Learn about the challenges investigators encounter in gaining access to substantial cryptocurrency assets and the potential methods for cracking encrypted wallets. We delve into the intricacies of cybercrime investigations, cryptocurrency laundering, and the multifaceted strategies employed to obscure financial trails. Discover how the Hydra case sheds light on the evolving landscape of online marketplaces on the dark web and the hunt for hidden fortunes.

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Keywords for SEO:

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Conclusion:

The enigma of Hydra's encrypted cryptocurrency wallets showcases the intricate challenges of modern cyberinvestigations. As law enforcement navigates the complexities of accessing hidden fortunes, the world watches with bated breath to see if the state can unlock the secrets held within these digital vaults. The evolving landscape of cybercrime and its interplay with the cryptocurrency realm highlight the need for innovative investigative techniques to ensure a safer digital future. As the Hydra case unfolds, it serves as a testament to the persistent efforts of those dedicated to unmasking the hidden aspects of the dark web. Stay tuned as we await the outcome of this high-stakes endeavor, set to conclude by mid-July.

Photo: Irina Buzhor, Kommersant

Text by: Alexander Mezentsev

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