I've heard a constantly repeated trope that darknet market adoption is the chief, or only, value metric for privacy-focused cryptocurrency projects. I've even heard it as the only worthwhile adoption metric for any digital cash-focused crypto.
I'd like to take a moment to dispel that myth.
Yes, demand for privacy will always trend higher in the criminal world than in the regular economy, but this is not a good be-all metric for the soundness of privacy technology, as I'll explain below.
Privacy Is Not Criminal!
First, I'd like to push back against the suggestion that privacy is criminal, or primarily for criminals. It's not. It's for everyone, from your grandmother to your favorite political refugee, to the illicit dealer on the corner, to your average entrepreneur.
Explicit criminal activity, as defined by major first-world liberal democratic nations, is only one of the many use cases for privacy. There are countless other use cases for privately transacting which may be illegal in certain jurisdictions (such as a totalitarian regime), but not globally, and excluded from explicit darknet markets.
Plenty of privacy use cases certainly have higher volume than explicit darknet purposes, including: political donations, embarrassing/personal (but extremely legal) purchases such as sex toys, date night purchases when seeking to keep one's wealth confidential, remote work including taking on extra work without the primary employer's knowledge, and so on. Each and every one of these individual use cases probably would have more demand and volume than darknet market usage, and certainly they do altogether.
In particular, I want to push back against the inherent tying of criminality to privacy because that's exactly what those who would ban privacy are trying to do. Furthering the darknet privacy myth actually hurts the cause of privacy for everyone.
Most Purchases Are White/Grey Market
The overwhelming majority of economic activity globally is not explicitly darknet or black market, but rather white market or grey market (under the table/illegal activity that could otherwise be perfectly legal if reported).
People spend money on housing, transportation, food, electronics, and more in orders of magnitude higher volumes than they do in explicitly-illegal markets and use cases. When a street vendor wants cash or crypto because they have no intention of reporting the income, that's still not darknet activity.
If private money is desired, this demand will overwhelmingly manifest itself outside of darknet markets.
Darknet Markets Are Honeypots for the Dumb!
At the risk of offending casual darknet market enjoyooors, I can think of a million smarter things to do than to go to the metaphorical "criminal activity dot com" and trust random internet strangers to not steal from me, sell my information, or report me directly to authorities.
It's a pretty safe bet that every major darknet market has a significant law enforcement presence, with the rest being made up mostly by exit scammers, unintelligent would-be criminals, and curious privacy tech nerds.
I am not a criminal, much less a sophisticated one, but I'd imagine most high-level criminal economic activity happens in much more discrete contexts than explicit online darknet markets with easily enough available usage statistics for random people on X to access for their online spats.
Privacy Level Is Only a Small Piece of Demand
Finally, the level of robustness of the privacy technology is only one of many elements of what makes a good private money.
If the most advanced privacy tech equaled the most darknet adoption (and vice versa), we'd see something like Zcash (or something that uses its tech without transparent options, like PirateChain or Hush) at the top. That's not the case, because other things matter more.
Bitcoin, despite its massive privacy issues, high fees and unreliable transactions, and dominant public reputation and surveillance, still frequently figures as the top, or one of the top, choices for darknet markets. Litecoin shows up too. The ByBit hacker swapped to Bitcoin. Some ransoms have even been demanded in Tether (which was promptly frozen). It almost seems like privacy is the last thing petty criminals prioritize.
The dominant attribute seems to be liquidity: is it easy to exchange the currency for something else, including in large quantities? Beyond that it appears to be adoption: how many people know about this currency, and where is it the most accepted? Concern for privacy of any kind seems to come after that.
Monero's growing position in the darknet world probably has more to do with its overall market position and usage, as well as its aggressive marketing in this domain, than its privacy function. Similarly, Zcash's integrations into high-level crypto companies like Brave, Flexa, and Gemini is probably similarly related to partnerships and marketing efforts in those ecosystems.
There are many things that make a digital money ideal. Privacy is certainly one of the most important aspects. Its usefulness and success, however, aren't measured by one simple metric. And even if they were, that metric wouldn't be darknet market adoption.