Binance assists law enforcement authorities in the takedown of a $100M darknet marketplace

The world’s largest crypto exchange, Binance, assisted the US and Taiwanese law enforcement authorities in their takedown of the darknet marketplace, the Incognito Market. The exchange disclosed this in a press release shared with Cryptopolitan.

According to the company, its Financial Intelligence Unit (FIU) was pivotal in helping law enforcement agencies crack down on the marketplace, facilitating illegal drug sales, and having an international network.

Incognito Market is a platform where users can buy over 1,000 types of illegal drugs anonymously and, according to reports, has facilitated more than $100 million in transactions. The marketplace reportedly enables payments using several cryptocurrencies within its internal banking system to ensure anonymity and evade detection.

However, the FIU provided information to law enforcement that assisted them in tracing illicit transactions and identifying the suspect. Beyond that, the exchange also froze $3.5 million worth of crypto connected to the case.

Binance described the news of its involvement as evidence that blockchain networks are not safe havens for criminal activity. The global head of Binance FIU, Nils Andersen-Roed, noted that privacy tools cannot even prevent law enforcement from detecting illicit use of crypto.

Andersen-Roed said:

“Even with sophisticated privacy tools, every crypto transaction leaves a digital trail – which is increasingly vital in today’s law enforcement investigations.”

Meanwhile, Andersen-Roed also noted that Binance’s cooperation with law enforcement is part of the new order in fighting crime. He noted that cross-border and public-private collaborations are essential as crypto cases become more complex.

Interestingly, Binance noted that it had also played a crucial role in the takedown of child exploitation platform Kidflix by Europol by helping European law enforcement authorities uncover the platform’s internal payment infrastructure and more than 100 users connected to it.

This is all part of the exchange’s effort to collaborate with authorities as part of its commitment to transparency and security. Since the exchange came under fire in 2023 and was fined over $4 billion by the US Department of Justice, it has tightened its compliance standards while increasing cooperation with authorities.

270 individuals arrested across four continents

Meanwhile, the takedown of the Incognito Market is only one of the achievements of a large-scale operation by the US law enforcement agencies and their international partners known as Operation RapTor, which led to the arrest of 270 people across four continents.

An earlier announcement by the US Department of Justice (DOJ) arrested darknet administrators, vendors, and buyers in several countries, including the US, the UK, Brazil, Austria, South Korea, Switzerland, the Netherlands, and Spain.

The DOJ described it as the biggest-ever seizure by the Joint Criminal Opioid and Darknet Enforcement (JCODE) team, with more than $200 million in fiat and digital assets recovered, as well as two metric tons of drugs and over 180 firearms.

One of those arrested through information provided by Binance was the administrator of Incognito Market, Rui-Siang Lin, who used the nickname Pharoah. Lin was arraigned before the court in 2024 and has pleaded guilty to three charges.

Binance continues to dominate

Meanwhile, Binance’s announcement came a few days after its Head of Financial Crime Compliance, Tigran Gambaryan, had exited. Gambaryan, who got into the public spotlight after spending eight months in detention in Nigeria, announced his exit on LinkedIn, adding that he is focused on new challenges.

His exit does not come as a total surprise, given that he had hinted at going back to the public sector in his interview after escaping detention. Still, he joins the list of around 16 executives who have left Binance in the last two years.

Despite several high-profile departures, Binance thrives with its improved compliance culture under CEO Richard Teng and still dominates trading volumes. The firm recently released its 31st proof of reserves, showing over $130 billion in net assets.

While former CEO and co-founder Changpeng Zhao remains influential, the exchange’s ideals no longer follow Zhao’s previous principles. For instance, Binance is reportedly considering establishing a global headquarters, a move away from Zhao’s belief that the exchange does not need a physical headquarters.