Chinese Crypto Scammers on Telegram Fuel Historic Darknet Market Growth

The rise of Chinese-speaking crypto scammers on Telegram has led to the establishment of unprecedented black markets. According to Elliptic, Tudou Guarantee and Xinbi Guarantee are facilitating close to $2 billion in money-laundering transactions and sales of scam tools each month. These markets have grown significantly despite previous bans, with Tudou Guarantee currently processing approximately $1.1 billion monthly and Xinbi Guarantee around $850 million.

From 2021 to 2025, Huione Guarantee, a predecessor to these markets, facilitated an astonishing $27 billion in transactions, making it the largest illicit online marketplace ever. The FBI has linked these operations to the ‘pig butchering’ scams, which exploit victims through fake investment schemes, generating around $10 billion annually from U.S. citizens alone.

Telegram has faced criticism for allowing these markets to thrive, arguing that they provide financial freedom for Chinese users. However, analysts contend that the majority of activities in these markets are criminal, including human trafficking and forced labor. This raises serious ethical questions about the platform’s responsibility in combating such activities.

Both Telegram and Tether, a cryptocurrency used for transactions in these markets, have been criticized for their roles in enabling these operations. While Tether has the ability to freeze funds, it has rarely intervened in the massive money flows associated with these scams.

Experts argue that a coordinated international response is necessary to address the growing threat posed by these scams. Without significant pressure from governments and law enforcement, the current approach remains inadequate to disrupt these criminal enterprises.

Implications for Users and Organizations

The activities of these markets reveal a troubling trend in the use of cryptocurrency for illicit purposes. Everyday users should be aware of the potential for scams that may appear legitimate but are designed to exploit vulnerabilities.

Organizations must also be vigilant in monitoring for signs of fraud and human trafficking linked to these operations. Implementing robust security measures and educating employees about the risks associated with cryptocurrency transactions can help mitigate exposure to these threats.

As these markets continue to evolve, users should remain cautious about any unsolicited investment opportunities, particularly those that involve cryptocurrencies. Recognizing the signs of scams and understanding the tactics employed by fraudsters is crucial for personal and organizational security.