Cryptomarkets – A phenomenon of the Global North?

• In Event: Online drug markets and their evolving dynamics

Abstract

Cryptomarkets, or darknet drug markets, have been described as a ‘transformative criminal innovation’ (Aldridge & Décary-Hétu 2014). By integrating emerging digital technologies such as TOR and cryptocurrencies, cryptomarkets facilitate drug transactions while simultaneously complicating law enforcement efforts. Although these digital platforms have the potential to disrupt the global drug supply chain and reshape the dynamics of drug distribution globally, empirical studies suggest otherwise. Studies using quantitative digital trace methods suggest that vendors on cryptomarkets predominantly operate from consumer countries of the Global North rather than from production or transit countries, often associated with the Global South.
This paper explores the reasons behind this geographical disparity, focusing on why cryptomarkets did take up in consumer countries of the Global North but not in production regions of the Global South. Adopting a comparative perspective on Europe and Latin America – a region traditionally associated with cultivation and production of plant-based illicit drugs – this paper examines the socio-economic factors shaping the adoption and use of cryptomarkets. Specifically, we assess the accessibility and integration of payment systems in both regions, their roles within the global drug supply chain, the trustworthiness of digital technologies and infrastructures, as well as the characteristics of drug markets and individuals engaged in drug-related activities. Additionally, the paper discusses policy implications, emphasising the importance of addressing the socio-economic conditions that enable the proliferation of cryptomarkets.

Authors

• Meropi Tzanetakis, Vienna University of Economics and Business

• Nigel South, University of Essex

• Julia Buxton, Liverpool John Moores University

• Tobias Boos, University of Vienna

• Matias Dewey, University of St. Gallen