Stanislav Moiseev, the mastermind behind the notorious online black market and cryptocurrency mixing service Hydra, has been handed a life sentence by a Russian court.
Hydra reportedly facilitated over $5 billion in cryptocurrency transactions before its closure, becoming the largest darknet marketplace in the world.
The Moscow Regional Court found Moiseev and 15 accomplices guilty of organizing a criminal enterprise and engaging in the illegal production and distribution of psychotropic substances and drugs.
Verdict Includes Prison Sentences for Moiseev’s Co-Conspirators
The verdict, announced on December 2, included prison sentences ranging from 8 to 23 years for Moiseev’s co-conspirators.
Additionally, Moiseev was fined 4 million rubles ($38,100), while the group collectively faced penalties amounting to 16 million rubles ($152,400).
Authorities also confiscated properties and vehicles linked to the defendants.
According to Russian state media outlet TASS, Moiseev and his associates will serve their sentences in strict-regime correctional colonies.
Hydra’s operations, which ran from 2015 until its takedown in 2022, accounted for an estimated 80% of all darknet-related cryptocurrency transactions in 2021.
U.S. Justice Department records reveal the platform’s staggering $5.2 billion in crypto revenue during its operation.
Hydra’s infamy stemmed from its role in selling stolen credit card information, counterfeit currencies, and fake identity documents.
Blockchain security firm Flashpoint, now affiliated with TRM Labs, reported a 624% surge in Hydra’s crypto volumes on exchanges between 2018 and 2020, highlighting the sophistication of its criminal activities.
The platform’s downfall came in April 2022, when German authorities seized Hydra’s servers and its Bitcoin reserves, shutting down the operation.
At the time, Hydra boasted 17 million customers and 19,000 vendor accounts. German law enforcement also confiscated nearly a ton of narcotics and psychotropic substances during the raid.
Hydra’s criminal activities had been under investigation by Russia’s Ministry of Internal Affairs since 2016.
Those convicted alongside Moiseev include Alexander Chirkov, Andrei Trunov, Evgeny Andreev, and others. Their sentences remain subject to appeal.
Despite Hydra’s closure, darknet marketplaces have continued to thrive.
A report by Chainalysis earlier this year revealed that darknet revenues exceeded $1.7 billion in 2023, surpassing figures from 2022.
Federal Court Overturns US Sanctions On Tornado Cash
Last week, a US appeals court overturned sanctions imposed by the Treasury Department on Tornado Cash, a crypto mixer that enables privacy in transactions.
The Fifth Circuit Court of Appeals ruled on 26 November 2024 that the Treasury’s Office of Foreign Assets Control (OFAC) exceeded its authority by targeting Tornado Cash’s immutable smart contracts, granting its users a partial summary judgment.
The three-judge panel argued that Tornado Cash’s smart contracts are not “property” under the International Emergency Economic Powers Act (IEEPA).
The Tornado Cash contracts, which operate as immutable lines of privacy-focused code, cannot be owned or controlled by any individual or entity, making them ineligible for sanctions under the IEEPA.
“We hold that Tornado Cash’s immutable smart contracts are not the ‘property’ of a foreign national or entity,” the judges wrote. “They cannot be blocked under IEEPA, and OFAC overstepped its congressionally defined authority.”
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