The Rise and Fall of AlphaBay

Introduction

• Date: July 5th, 2017
• Location: Bangkok
• Main Character: Alpha02 (a multi-millionaire and kingpin of the dark web)
• Incident: A woman crashes her car into Alpha02's gate; she is an undercover agent part of a larger operation by the Royal Thai Police, FBI, and DEA.

Context: The Dark Web Boom

• Early 2010s: The dark web and Bitcoin facilitate anonymous criminal transactions online.
• Silk Road: The first major dark web marketplace, launched in February 2011, shut down after 2.5 years, resulting in the founder receiving a life sentence.
• Post-Silk Road: Explosion of darknet markets (Silk Road 2.0, Evolution, Agora, etc.).
• Exit Scams: Notable issue where platform operators disappear with users' money.

The Emergence of AlphaBay

• Founded: July 2014 by "Alpha02".
• Initial Offerings: Stolen credit card data, expanded to drugs, weapons, malware, and money laundering services.
• Forbidden Items: Child abuse-related, hit-and-runs, and stolen bank account info from Russia.
• Platform Functionality: User-friendly interface, Bitcoin/Monero/Ethereum payments, a tumbler to mask transactions.
• Growth: By 2017, 300,000 items listed, over $500,000 in daily sales, 2-4% commission on transactions.

Transition in Management

• Alpha02 rebrands to "Admin," delegates operations to "DeSnake" and others.

Investigation and Identification

• Search for Alpha02’s identity intensifies by American investigators.
• Breakthrough: Early mistake revealed email address "[email protected]".
• Identification: Alexandre Cazes from Trois-Rivières, Quebec, Canada.

Surveillance and Assets

• Location: Bangkok, Thailand.
• Assets: Multiple properties, luxury cars, millions in cryptocurrency.
• Daily Life: Mix of mundane activities and lavish lifestyle.

Operation Bayonet

• July 5th, 2017: Coordinated international effort to arrest Cazes.
• Arrest Strategy: Using a staged accident to lure Cazes out with unlocked devices.
• Success: Cazes arrested, laptop seized with active sessions to AlphaBay servers.
• Alpha02's Wealth: $23 million in assets confiscated.
• Aftermath: Cazes commits suicide in custody on July 12, 2017.

Aftermath and Impact

• AlphaBay and Hansa Market shut down by authorities.
• Migratory Effect: Users move to other darknet platforms temporarily controlled by authorities (honeypot operation).
• Long-term: Darknet markets continue to evolve despite authorities' efforts.
• Current Contender: "DeSnake" re-launches AlphaBay in 2021.

Ethical Considerations

• Discussion: The dark web's duality as a haven for whistleblowers and a criminal marketplace.