India’s NCB and Binance Smash ‘Ketamelon’ Darknet Syndicate in $1.2M Bust

Key Takeaways

• India’s Narcotics Control Bureau (NCB) dismantled the nation’s top drug darknet syndicate, “Ketamelon,” seizing $1.2 million in drugs and crypto.
• Mastermind Edison Babu used Monero (XMR) and Tether (USDT) for payments, leveraging India’s postal system for stealth delivery.
• Binance provided critical blockchain analysis, tracing transactions, and freezing assets to aid the arrest.

The Digital Drug Lord: How a Kerala Engineer Built an Empire

To outsiders, Edison Babu seemed to be just another tech worker from Kerala. But, when his name appeared on an investigative database maintained by India’s National Central Bureau (NCB), investigators found that Babu was India’s only “Level 4” vendor, running a drug darknet syndicate named Ketamelon from his home. 

The darknet vendor used encrypted communication channels and a bootable operating system called The Amnesic Incognito Live System (Tails OS) to eliminate digital footprints. Babu shipped lysergic acid diethylamide (LSD) and ketamine to more than 600 unique addresses throughout India, disguised as e-commerce parcels, and payments were made via privacy coins like Monero (XRM). But Babu’s biggest mistake was making withdrawals at regulated exchanges.

In June, India’s NCB partnered with the Data Security Council of India (DSCI) to launch Operation Melon. After intercepting three postal parcels in Kochi and identifying their origin, investigators raided Babu’s home. Armed with an NCB search warrant, authorities discovered an additional 1,127 blots of LSD, 131g of ketamine, and hardware wallets that contained around $80.000 in USDT.

Binance’s Part: Tracking the Untrackable

Babu thought he was anonymous with the use of privacy coins, but Binance’s Financial Intelligence Unit showed otherwise. The Unit identified crypto wallets linked to Ketamelon by analyzing blockchain behavior and off-ramping points to freeze assets and identify suspects. 

“Criminals may operate in the shadows of the darknet and use privacy coins, thinking they’re invisible, but they inevitably leave digital traces. By leveraging advanced analytics and working hand-in-hand with investigators and other stakeholders, we helped trace and freeze those illicit funds. Binance remains committed to proactively supporting such operations to ensure bad actors are brought to justice and to keep the crypto ecosystem safe for everyone.” Nils Andersen-Röed, Global Head of Financial Intelligence Unit (FIU), Binance.

This partnership between crypto exchanges and law enforcement shows a growing trend in combating darknet economies. A similar strategy was taken in 2023, when the NBC uncovered another 5-star darknet syndicate called the “Zambada” cartel.

The Darknet Syndicate Fall: What This Means for Crypto and Crime

Ketamelon’s collapse has debunked the myth of anonymity in crypto. In this case, with Babu relying on official exchanges for liquidity, it opened a clear path to identification, regardless of the anonymity tools he used. For the crypto space, it’s a reinforced belief in compliance partnerships; for criminals, it is a warning that while blockchain may seem like a shadow to them, it can always be a ledger.

In contrast, darknet vendors are figuring out how to be even stealthier. They use decentralized exchanges (DEXs), cross-chain swaps, among other methods, to avoid detection.

Final Thought: Babu’s darknet syndicate fate is a paradox. As his trial proceeds, his story suggests that the technology that enabled his crypto empire’s rise ultimately led to his downfall. In crypto, privacy could be a feature, but transparency is the foundation.

---

FAQs

---

For more darknet-related stories, read: Abacus Market Vanishes: $400M Darknet Empire Collapses in Suspected Exit Scam