Although individual cryptomarkets tend to have a relatively short life span, the sector as whole has survived various challenges, such as exit scams and law enforcement take downs. At the same time, although the size of the drugs trade via cryptomarkets is still very small;compared to offline trade, transactions have tripled since the take-down of Silk Road and revenues have doubled. The Internet has offered opportunities for drug entrepreneurs to create new business models and tap into a new consumer base, while reducing many of the risks associated with offl ine markets (e.g. violence), and introducing new risks (e.g. postal interception, scams).
The full impact of the Internet-facilitated drugs trade on the global market for illicit drugs remains inconclusive and unclear. There is evidence to suggest that cryptomarkets are fuelling offl ine markets for illicit drugs, but more work is required to fully understand the extent to which buyers of drugs online are distributing them offl ine. Finally, there are different arguments about the societal impacts of cryptomarkets. Some have argued that they actually reduce violence from the drug supply chain, which could be seen as a positive benefit. However, others believe that, by offering a new, often young, consumer base easy access to drug markets, cryptomarkets have largely negative consequences.
From: Rand corporation. Read full report here.