I'm sorry, I am a police officer! An undercover agent from the US tax authority posed as a currency trader on a P2P platform, successfully luring out dark web drug dealers.

An undercover agent from the Internal Revenue Service in the United States unexpectedly arrested a dark web drug dealer after posing as a reputable seller on a peer-to-peer cryptocurrency platform. The transactions between the two amounted to over $180,000. Following the drug dealer's admission to running a business selling cocaine and other drugs, authorities moved in and gathered evidence to apprehend the individual.

Mr.Coins

Last year, IRS agents from the Internal Revenue Service went undercover on the peer-to-peer cryptocurrency trading platform LocalCryptos using the alias "Mr.Coins." According to a report by Forbes, Mr.Coins handled over $200,000 while undercover on the platform and maintained a perfect rating of 100%.

In June of last year, "Mr.Coins" posted an advertisement on the platform offering to conduct cryptocurrency transactions in a relatively discreet manner, using methods such as cash and mail at a premium to market prices. A user on the platform named "Lucifallen21" promptly made an offer.

The two parties communicated through encrypted messaging apps Wickr or WhatsApp. "Lucifallen21" would conceal the cash in clothing and send it in a package to the agent to complete the transaction. "Lucifallen21" also purchased tens of thousands of dollars worth of Bitcoin and Monero in the following months.

Conversations on Wickr indicated that "Lucifallen21" was involved in selling illicit drugs such as cocaine on the dark web, prompting authorities to take further action.

Key Phone Call Reveals Identity

In March of this year, the IRS claimed they were about to close in on the undercover operation. A $28,000 cash package from "Lucifallen21" was intercepted at the post office and declared lost, allowing the IRS to listen in and track the suspect's complaint phone call.

This final package also enabled law enforcement to collect fingerprints, revealing that "Lucifallen21" was actually Chase Hite, a resident of Indiana. He was ultimately arrested in July of this year, with his lawyer, the IRS, and LocalCryptos all declining to comment on the matter.

In this case, the transparency of blockchain data, which is a key advantage, did not seem to play a significant role. Instead, it once again highlighted the use of cryptocurrency in dark web drug transactions. However, perhaps further tracking of the cryptocurrency flows of "Lucifallen21" may provide more leads.