Darknet Transactions On Bitcoin (BTC) Doubled In The Year 2018 But This Isn’t Such A Bad Thing

bitcoin price gain

In 2018, the cryptocurrency market suffered a massive blow. The price of cryptocurrencies fell by up to 90% from their all-time-highs. The total market capitalization dropped from over $800 billion to $100. Bitcoin (BTC) fell from as high as $19,500 to as low as $3150 within eleven months. The fall in price wasn’t the only thing that the industry suffered last year. Statistics showed that the number of darknet transactions on the Bitcoin network doubled during this period. From being used to make questionable transactions to being used by illegal drug dealers who wanted to stay off the radar, BTC became popular on the darknet over the years.

Reuters Reports Claim Darknet Bitcoin Transactions Doubled In 2018

The recent report that was published by Reuters made reference to the data collected by Chainanalysis which stated that the number of illegal activities related to BTC has increased dramatically over the last twelve months. Chainanalysis has been employed by governments in the past to weed out corrupt actors. This time, the company did not explain how it managed to separate the bad Bitcoin transactions from the good or normal ones. It stated that up to $2 million in BTC were routed via darknet marketplaces.

Bitcoin (BTC) Price Today – BTC / USD
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In 2018, about $600 million had been spent on the darknet. This is $100 million lower than what was spent on the darknet in 2017. However, BTC was used for 14.3% of these transactions in 2017 while it was used for 70% of these transactions in 2018. The difference is clear. Bitcoin’s decentralised and immutable characteristics make it ideal for illegal activities.

Why The Rise In BTC Darknet Activity Isn’t Such A Bad Thing

While the transactions on the darknet are illicit, they underscore a bullish trend for BTC. Also, as the prices dropped and darknet transactions increased, there was impressive fundamental growth in the industry. The year 2018 is still fundamentally the best for Bitcoin (BTC) so far. About $410 billion in BTC was transacted during the period while the hashrate doubled. Bitcoin still remained the most secure transaction settlement layer in the world. While scaling solutions haven’t been concluded, there was notable adoption during this period. SegWit, one of the BTC scaling solutions, increased in usage from 10% to 40% within the year 2018 alone. Bitcoin Lightning, another solution that uses off-chain ledgers to facilitate cheap, immutable, private and scalable transactions, increased to 500+ Bitcoin capacity.

The year 2019 has just started and much data hasn’t accumulated yet. However, there is evidence that Bitcoin, the largest cryptocurrency per market capitalization, is going to keep getting traction. Already, many projects are being put in place to ensure Bitcoins increased adoption. Yesterday, smarttest.wpmudev.host reported that Coinstar, a Kiosk provider based in North America, entered a partnership with Coinme, a Bitcoin ATM provider, to offer Bitcoin selling services to its customers. With this partnership, more than 20,000 kiosks operated by Coinstar will offer Bitcoin for spare change. This is going to foster the use of Bitcoin as a day-to-day medium of exchange around the United States and Canada.

Do you believe the darknet adoption of BTC is a going to reduce the already fragile credibility of the network? Share your thoughts.

Ufuoma Ogono is a cryptocurrency writer with over 3 years experience in the cryptocurrency industry. She dedicates her time to sharing valuable information to members of the cryptocurrency community.


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