A young man from New York, Rui-Siang Lin, aged 23, has been taken into custody by the FBI for managing and profiting from a dark web drug market worth $100 million.

Law enforcement utilized cryptocurrency transaction tracking to reveal Lin's true identity, leading to his apprehension at John F. Kennedy Airport on May 18. He made an appearance in federal court on May 20, as reported by the Manhattan United States Attorney’s Office.

FBI Apprehends Operator of Dark Web Market

Known online as "Pharoah," Rui-Siang Lin was the alleged operator of "Incognito Market," a well-known dark web platform for drug sales.

James Smith, the FBI Assistant Director in Charge, remarked, “Over a span of almost four years, Rui-Siang Lin purportedly managed ‘Incognito Market,’ a major online hub for drug transactions, handling $100 million in illegal drug deals and making millions in personal profits.”

Incognito Market operated as an onion-based online marketplace accessible through the Tor web browser, commonly known as the “dark web” or “dark net.” It facilitated the trade of various drugs such as cocaine, LSD, MDMA, and prescription amphetamines like Adderall, with Bitcoin and Monero as the accepted payment methods.

Market Mandated Crypto Usage for Transactions

The platform mandated that both buyers and sellers utilize its in-house cryptocurrency services, enabling it to levy a 5% fee on each transaction and offer an escrow service. The Justice Department disclosed that the market ceased operations in March this year following reports of an exit scam that allegedly defrauded customers of millions in Bitcoin and Monero.

Lin is now facing multiple severe charges, including involvement in a criminal enterprise, drug conspiracy, selling misbranded medication, and money laundering. The criminal enterprise charge alone carries a mandatory life sentence upon conviction, while the drug conspiracy charge also carries a potential life sentence.

FBI's Crypto Tracing Investigation

In addition to these charges, the Justice Department has requested the forfeiture of cryptocurrencies held in Lin’s Binance and Kraken accounts.

The FBI's probe into Lin involved tracking cryptocurrency transfers associated with Incognito Market. They uncovered that funds from the market's wallet were moved to a centralized crypto exchange account registered under Lin’s name. FBI officer Mark Rubens stated in a testimony that a crypto wallet controlled by Lin received funds from Incognito Market, which were then transferred to an exchange account in Lin’s name.

Connecting Email and Phone Details

Rubens outlined at least four transactions that purportedly demonstrated Lin's crypto wallet sending Bitcoin obtained from Incognito Market to a swapping service for conversion to Monero. This Monero was subsequently deposited into a crypto exchange account allegedly owned by Lin. The exchange provided the FBI with Lin’s Taiwanese driver’s license, email address, and phone number used to create the account.

The FBI also linked Lin’s email and phone number to a Namecheap account that utilized funds from his crypto wallet and account to purchase a domain promoting Incognito Market. The testimony indicated that deposits into Lin’s crypto exchange account increased with the market’s growth, rising from around $63,000 in 2021 to nearly $4.2 million in 2023. Another undisclosed exchange account received deposits totaling $4.5 million between July and November last year.