What is parallel economy

The criminal parallel economy on the net

If you compare the Internet with the sea, we are only moving on the surface with Google, Facebook and Co. - where the whitecaps slightly ripple. With “Darknet - the shadowy world of the Internet”, the journalist Otto Hostettler has published a work that deals with the dark side of the Internet - an educational book for the public. Drugs, trafficking in women, medication, counterfeit money, money laundering or weapons - everything that generates high profits is traded on the Darknet. The damage that trading on the Darknet inflicts on the global economy every year is gigantic: According to Europol, it is 300 billion US dollars.

 

But what is the Darknet and where can you find it? The term “Internet” means, first of all, all content posted online. According to the online statistical analysis service "Internet Live Stats", there are around a billion websites. Experts agree, however, that the vast majority of the sites put online around the world cannot be found with a Google search engine. Europol estimates that just four percent of all existing websites are indexed by search engines and are therefore visible to the entire public. The pages that cannot be found also include many pages with password barriers from administrations, libraries, universities and databases.

The bottom of the iceberg

The term “Darknet” or “Darkweb” is understood to mean so-called “hidden services” which, due to the structure of their domain names, can only be found with the “Tor” browser. Some Darknet poets also speak of Darknet as the "underside of the iceberg floating in the sea". "Tor" disguises the IP address by wrapping the data packets multiple times or by passing them on through three stations. Almost three million Internet users use this software every day, which was originally developed for the American Department of Defense and which encrypts all data in such a way that it is no longer possible to determine which computer is currently accessing which content.

In English, the Darknet is also known by the name Onionland: The onion symbolizes the layered encryption. The Darknet is now a part of the Deeb Web, which has a completely different dimension. There are estimates that the Deeb Web is about 500 times larger than the World Wide Web.

In the Darknet, a rapidly growing number of traders offer a worldwide clientele an almost unbelievable range of illegal goods and services. Your online shops are built as cleverly as Amazon, Zalando or Ebay. In this economic world, $ 300,000 to $ 500,000 a day is spent on illegal products on various “marketplaces”. Many of these platforms appear and disappear again quite quickly. The volatility is great. It is not known how many marketplaces are currently offering goods and services - estimates assume 40,000, with numerous offers such as "Financial Services", "Hacking" or "Drugs". The internet addresses of the marketplaces consist of cryptic columns of numbers and letters. Addresses in the Darknet are not addressed directly, but redirected via other network users. This is how every identity is veiled.

A bitcoin, please

The offers on the Darknet are booming. Above all, the demand for drugs and medication is growing - more than 202,000 offers were recently online. Each marketplace also has an extensive forum. This is where retailers and users exchange ideas on general questions, warn each other about fraudulent market participants and discuss technical problems. Because the danger of falling for deceivers in the Darknet is quite high. The American non-governmental organization "Rand" suspects that 30 percent of all Darknet sellers are fraudsters.

In the Darknet, payment is made with Bitcoins, the crypto currency that cannot be controlled or regulated by the government or a central organization. Bitcoins can be bought on online platforms (rate September 6, 2017: one Bitcoin = 3,864 euros). Some banks also run such exchanges. To initiate a transaction, you need the Bitcoin address of the recipient of the money. The transaction is not completed until the verification process has been carried out by the network. The digital series of numbers as the equivalent of the money is credited to the recipient. The transaction is encrypted and entered into a public booking system (blockchain). Then a complex cryptographic verification process begins. This ensures that the currency units are not issued twice.

Better than his reputation

Not only cyber criminals, the organized crime syndicates and traders of illegal products use the Darknet. There is definitely a good side: Government critics, journalists, dissidents, whistleblowers or secret services, who for understandable reasons remain anonymous and want to conceal their location, also use the dark network. According to the latest research findings, the importance of the Darknet with its illegal offers is less than many think, writes the Berliner Zeitung: You can even find websites that can only be accessed with the “Tor” browser and all of them end with “onion” many websites for legitimate reasons. These "hidden services" - that is, hidden offers - protect against censorship. Facebook, for example, allegedly operates one of the largest "hidden services". The social network bypasses the censorship regulations of some governments. Users from these countries can still use the service thanks to the parallel network.

Conclusion

The fact that the Darknet is not only used for criminal activities may be an indication, but not reassurance. Certainly some myths about the Darknet are exaggerated, for example that contract killers offer their services on every corner, drugs can be ordered like chewing gum machines, and it is like being on a pirate island all the time. Nevertheless, caution is advised. Hostettler's book provides the appropriate explanation. Every user should become much more aware of the existence of the Darknet than before and know the challenges that it brings with it.

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EconomicsTagged digitization, shadow economy