The recent shutdown of Haowang Guarantee, once the world’s largest illicit online marketplace for crypto scams, has been heralded as a significant victory in combating cybercrime. However, according to blockchain analytics firm Chainalysis, this development represents only a temporary setback for crypto scam networks. The structural enablers that allow these illicit activities to thrive remain firmly intact. This ensures the resilience of criminal operations in the crypto space.
Haowang Guarantee: A Hub for Illicit Activities
Haowang Guarantee, formerly known as Huione Guarantee, announced its closure last week following restrictions imposed by Telegram. The platform operated as a non-KYC (Know Your Customer) marketplace on Telegram. Third-party vendors offered technology, personal data, and money laundering services. It effectively functioned as a one-stop shop for crypto scammers and other malicious actors. Haowang played a pivotal role in facilitating global cybercrime.
Telegram’s decision to shut down Haowang came after the U.S. Treasury’s FinCEN designated its parent company, the Cambodian conglomerate Huione Group, as a money laundering enterprise tied to North Korean cybercriminals. The messaging platform also took action against Xinbi Guarantee, the second-largest marketplace of its kind. This signals a broader effort to curb illicit activities on its platform.
Why Haowang’s Closure Isn’t Enough
While the takedown of Haowang is initially hailed as a major blow to the global crypto scam network, Chainalysis argues that the impact is limited. Criminals quickly adapt by migrating to other “guarantee” services. These platforms provide similar infrastructure for illicit activities.
“These services are likely designed for redundancy, speaking to the resilience of criminals and the lucrative nature of their businesses,” Chainalysis stated in its Monday report.
Although Haowang is the most prominent player, numerous other platforms continue to enable crypto scammers to access criminal tools and services. Vendors often operate across multiple marketplaces, making it easy for them to migrate when one service is offline.
“Vendors migrate, new services fill the void, and users adapt quickly,” said Chainalysis. “For now, the Huione Group takedown may shift some traffic, scramble broker relationships, or inspire short-term caution, but the structural enablers of crypto crime unfortunately remain intact.”
Telegram’s Role in the Problem
Despite its efforts to remove accounts linked to Haowang and Xinbi Guarantee, Telegram remains the primary hub for guarantee services. Its built-in pseudonymity, ease of access, and design features that make monitoring chats difficult contribute to making it an attractive platform for illicit activities.
The Need for a New Approach
Chainalysis emphasized that conventional platform takedowns, like the closure of Haowang, are increasingly ineffective in addressing the root causes of crypto crime. Instead, the focus should shift to monitoring illicit transaction behaviors on a case-by-case basis.
By analyzing patterns and behaviors in on-chain flows and activities, authorities and blockchain analytics firms can better identify and disrupt criminal networks. This approach targets the structural enablers of crypto scams. It does not merely shut down individual platforms that can be easily replaced.
