Russian Authorities Confiscate $8.2 Million in Cryptocurrency from Head of Hydra Darknet Server

Russian authorities seized cryptocurrency valued at approximately 649 million rubles ($8.2 million) from the wallets of Dmitry Pavlov, a 35-year-old self-admitted server operator for the Hydra darknet platform.

The Russian publication Izvestia reported that documents revealed in court this month confirmed that law enforcement officials have frozen and confiscated assets from Pavlov’s cryptocurrency wallets.

Hydra Darknet Server Operator ‘Received Payment in Crypto’

Pavlov stated that he obtained the cryptoassets as “a salary and bonuses” for his role in managing the Hydra servers.

A criminal organization compensated Pavlov “approximately 15 million rubles ($189,277) annually” in cryptocurrency for his work, according to prosecution representatives.

The defendant indicated that he did not convert his coins into cash. Instead, he retained the cryptocurrency, anticipating that its value would continue to rise.

Hydra operators also provided Pavlov with cash to cover operational expenses, prosecution officials noted. In December of the previous year, a branch of the Moscow District Court sentenced 16 individuals for their involvement in Hydra.

The operation’s leader, Stanislav Moiseev, received a life sentence after the court learned that the portal enabled over $5 billion in cryptocurrency transactions.

Prosecutors mentioned that Russian specialists concurred with Chainalysis assessments regarding the scale of the firm’s cryptocurrency activity.

Stanislav Moiseev, the architect behind the infamous online black market Hydra, has been sentenced to life imprisonment by a Russian court.#Hydra #Cryptohttps://t.co/9uuAfft63K

— Cryptonews.com (@cryptonews) December 4, 2024

‘Couriers Delivered Cash to Pavlov’

Moiseev and others provided Pavlov with funds to lease and maintain servers at the German firm Hetzner, prosecutors explained.

These expenses alone ranged from 1.5 to 2 million rubles ($18,928-$25,239) each month. Hydra managers “occasionally” dispatched couriers to Pavlov with bags of cash, prosecutors added.

Hydra’s annual revenue at the time of its closure was reported to be $1.7 billion, as testified by an employee from Rosfinmonitoring during Pavlov’s trial. The staff member estimated that the platform took a commission of 2% to 5% from cryptocurrency transactions conducted on Hydra.

Rosfinmonitoring (officially known as the Russian Federal Financial Monitoring Service) serves as the country’s primary anti-money laundering authority.

Another expert testified that the “net profit of Hydra’s co-founders alone,” considering related services, reached “approximately 100 billion rubles ($1.3 billion) annually.”

Last month, Chainalysis reported that while there was a 15% decrease in global cryptocurrency sales across darknet markets in 2024, Russian platforms defied this trend. The latter experienced a 68% increase in cryptocurrency sales, according to the firm.

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