Silk Road

Silk Road

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Updated Mar 01, 2017 at 07:23PM EST by Brad.

Added Oct 24, 2012 at 03:28PM EDT by Don.

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H, Silk Road anonymous marketplace

About

Silk Road is an online black market which can only be accessed via The Onion Router (TOR) anonymous web browsing client. On the site, goods are sold in exchange for Bitcoins, a peer-to-peer digital crypto-curency created by Satoshi Nakamoto. Many of the sellers specialize in selling drugs, oftentimes shipping to countries where they are illegal to possess.

History

The Silk Road[11] website began development in November of 2010 and was launched three months later in February of 2011. The site remained relatively unknown until June 1st, 2011, when Gawker[5] published an article by staff writer Adrian Chen titled "The Underground Website Where You Can Buy Any Drug Imaginable." On July 28th, 2012, the tech news blog Gizmodo[13] reported that a man from Melbourne, Australia had been arrested for attempting to import drugs purchased on the site. On August 1st, 2012, a paper titled "Traveling the Silk Road: A measurement analysis of a large anonymous online marketplace"[12] was released by Carnegie Mellon computer security professor Nicolas Christin, which reported that the site's total sales had increased to approximately $1.9 million a month (shown below).


︵ 7000 O 6500 2 6000 5500 5000 4500 . 3500 3000 2500 ︶ 2000 Progressive rate- Fixed 6.23% rate 03/01 04/01 05/01 06/01 07/01 08/01 Date (all dates 2012)

Use of Bitcoin

The Bitcoin protocol was first described by Satoshi Nakamoto[2] in a paper[4] distributed on a cryptography mailing list[3] on October 31st, 2008. The Bitcoin network itself was created on January 3rd, 2009, which included the release of the first Bitcoins and an open-source Bitcoin client. Bitcoins use a peer-to-peer network that regulates the currency according to network software, with no more than 21 million Bitcoins issued in total by 2140. Bitcoins can be purchased and current exchange rates can be viewed on the MT Gox[8] Bitcoin exchange.

FBI Seizure & Closure

On October 2nd, 2013, the U.S. Federal Bureau of Investigations (FBI) shut down Silk Road and arrested its suspected owner Ross William Ulbricht, a 29-years-old University of Texas graduate living in San Francisco, California, on charges of narcotics trafficking conspiracy, computer hacking conspiracy and money laundering conspiracy. In addition, the authorities also seized $3.6 million worth of digital currency Bitcoin, the de facto currency used to complete transactions on the site. According to the court documents[18], the site allegedly facilitated more than 1.2 million illegal transactions involving 146,946 unique buyers and 3,877 unique vendors, generating more than 9.5 million bitcoins, or $1.2 billion, in total revenue. The files also revealed that Silk Road collected about $79.8 million worth of bitcoins in commission and site administrators received salaries of $1,000 to $2,000 weekly.


Road ÷ 曲. 8 skroadteper.oren 冗 THIS HIDDEN SITE HAS BEEN SEIZED by the Federal Bureau of Investigation, in conjunction with the IRS Criminal Investigation Division, ICE Homeland Security Investigations, and the Drug Enforcement Administration, in accordance with a seizure warrant obtained by the United States Attorney's Office for the Southern District of New York and issued pursuant to 18 U.S.C.983(j) by the United States District Court for the Southern District of New York 企 de曲 U S US 홉

That same day, The Daily Dot published a summary digest of the FBI's official complaint filed against Ulbricht. According to the files, the investigation began in January 2011, around the same time Silk Road was launched, with an individual who used the handle "Altoid" to advertise a Tor-protected anonymous black market on recreation drug forums and BitCoin discussion sites. Then in October, Altoid posted a job listing on BitcoinTalk forum in search of “an IT pro in the Bitcoin community,” adding his personal e-mail account "rossulbricht at gmail dot com" as the reply address. After examining his records from Google, the FBI was soon able to determine that "Altoid" is an account used by Ross William Ulbricht.

Reopening

On November 6th, 2013, the deep web news site All Things Vice[19] reported that the Silk Road had re-opened under the name "Silk Road 2.0," speculating that the newly restored website could be an authentic effort made by old Silk Road administrators or a so-called "honeypot" site set up by the law enforcement. As of November 15th, account registration remains limited to invitation-only. In the following days, the rumored revival of Silk Road was picked up by numerous internet blogs and mainstream news outlets.[20][21][22]


Silk Road messages ronsoaccontsao。 anonymous marketSearch the Dread Prate Roberts Go Drugs 490 Cannabis 82 Dissociatives Ecstasy 64 Welcome to Silk Road, we rise again. Dear Cemmunity Opioids Other 5 Precursors 13 Prescription 90 we, great joy mat announce the nexdehapter oe our pourney Six Road has risen from the ashes and s noa ready and watng tor you al to retan home hmp wsaomowtkonion Simulants 3 Apparel 77 Ast o Biobc materials o Books 17 Colecibles o Computer equipment Custom Orders Digtal goods Drug paraphernalia 3s Electronics Erotica o Forgenes Hardware o Herbs & Supplements o Jewery 4 Lab Supples Lotteries & games: Medical o Money 3 Packaging Services Witing Welkcome back to freedom Over the last 4 weeks we have impliemented a complete security overnaul This ovenaul marks the dawn or a brand new era for hdden services and禮would not have been possie without the patient support of his community. So for wating pabenity, for onering encouragement for keeping the community spint alive n sik Roads temporary absence, for al of this and more, each of you has my deepest and most sincere grattude took the FBI two and a hat years to do what they dd Dvide conquer and eimnate was ther strategy but four weeks of temporary serce aithey got And as our restent communty tourees back even stronger man ever betore. never torget that tney can ony ever sece assets-ney can never arrest our spint our deas or our passion unless we let them we ws not iet them Please enjoy the marketpixe, but be aare athough the ste is both funcbonal and stable, we are s the earny pnases of development Despte us naving worked through any major bugs that might prevent us-unctionality or compromise security, you may notce minor bugs Pease bring these to our abention More so, even thowgh securty has been our top priorty over the last few weeks, we encourage you to continue reporting both theonetcal and even proven esplots you will be rewarded for doing so Please aso be aware, hat because re expect a large surge in Btcon deposts when we open up our transaction system there may be delays with account withdrawals and deposits initialy These delays should become less as the marketplace setties, but at least for the earner stages please do not report coins as messing uniess 12 hours or more have elagsed You mgnt aso notce man me ee-aunched maneesaceans a numeer of features tornme㈥nat

BitInstant CEO Arrest

On January 27th, 2014, the U.S. federal authorities arrested Charlie Shrem, the CEO of Bitcoin exchange website BitInstant, at the JFK International Airport on charges of laundering more than $1 million worth of bitcoins for Silk Road customers and operating an unlicensed money-transmitting business. On the following day, the FBI arrested one of Shrem's suspect partners Robert Faiella on the same charges. According to the criminal complaint and an investigation by the Internal Revenue Service, Shrem and Faiella exchanged $1.05 million in bitcoins over a 10-month period, during which they stayed in touch via e-mail correspondences to ensure that their transactions remain undetected from cash-processing companies.

Silk Road 2.0: FBI Seizure & Closure

On November 6th, 2014, the FBI announced in a press release[23] that the operator of Silk Road's successor site has been arrested, identifying the man as 26-year-old San Francisco resident Blake Benthall[24] (a.k.a. Defcon). According to the federal officials, Silk Road 2.0 facilitated upwards of $8 million per month in transactions through more than 100,000 users over the course of one year since the closure of the original marketplace. That same day, the U.S. Immigration and Customs Enforcement agency posted a notification of seizure and closure on the website of Silk Road 2.0 (shown below).


U.S. Immigration and Customs Enforcement THIS HIDDEN SITE HAS BEEN SEIZED as part of a joint law enforcement operation by the Federal Bureau of Investigation, ICE Homeland Security Investigations, and European law enforcement agencies acting through Europol and Eurojust in accordance with the law of European Union member states and a protective order obtained by the United States Attomey's Office for the Southern District of New York in coordination with the U.S. Department of Justice's Computer Crime & Intellectual Property Section issued pursuant to 18 U.S.C. § 983(j) by the United States District Court for the Southern District of New York 乙 EUR POL

The Daily Dot[25] published an article about Benthall, which included images taken from his Facebook[26] and Instagram[27] pages (shown below). The article also revealed that Benthall could face decades in prison on charges of conspiring to commit narcotics trafficking, conspiring to commit computer hacking, conspiring to traffic in fraudulent identification documents and money laundering.


It looks like you're trying to view my Facebook. Would you like any assistance? e Uke all the things e Farm all the villes. am defined by my friend count Blake Benthall Follow Message Timeline About Photos Friends More ▼ DO YOU KNOW BLAKE? Follow Blake to get his public posts in your news feed. ABOUT Blake Benthall via Jón Gnarr October 27 at 4:22pm Software Engineer at SpaceX and Principal at Blake Benthall Consulting Past RPX Corporation and RPX Corporation okay. time to move back to Houston. Met Jón briefly in Iceland "l've never been there. Texas, in my mind, is a bit like Mordor or something," he told a Vice reporter. Leyna Diego SF Embassy: Iceland Airwaves '13 (Oct 30 Nov 3) Lives in San Francisco, California From Houston, Texas Followed by 75 people Comedian-turned-mayor Jon Gnarr moving to Houstorn Gnarr served as the mayor of the Icelandic city from 2010 to 2014 after founding his own political party, The Best Party. He's credited with bringing a bit of levity to a country and city that was in financial ruin. Notably.. CHRON.COM PHOTOS blakeisblake ▼ 364 335 postsfollowers following 448 Blake Benthall songwriter, rocket scientist SpaceX Follow October 2014 September 2014 August 2014 58 BUC-Ee'S

Silk Road 3 Reloaded

In November 2014 after the closure of Silk Road 2.0, the Diabolus Market was renamed to "Silk Road 3 Reloaded." On November 7th, The Daily Dot[28] published an interview with the operator of the marketplace, who identified himself as the new DreadPirateRoberts. In January 2015, the site joined the Invisible Internet Project (I2P) with support for trading using multiple types of cryptocurrencies.

DEA Extortion Controversy

On March 25th, 2015, a criminal complaint[30] was filed against former DEA officer Carl Mark Force IV and Secret Service agent Shaun Bridges for theft of government property, wire fraud, money laundering and conflict of interest while working on the task force investigating the Silk Road. In the complaint, Force was accused of threatening Ulbricht with giving the government information about his operation in exchange for $250,000.


SEALED BY COURT ㅇRDER AO 9I (Rev 1111) Criminal Complaint UNITED STATES DISTRICT COURTORiGINAL FILED MAR 25 2015 for the Northern District of California RICHARD W. WIEKING CLERK, U.S. DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA United States of America Case No CARL MARK FORCE IV, et al 3 -15-7 03 7U Defendantts MEJ CRIMINAL COMPLAINT I, the complainant in this case, state that the following is true to the best of my knowledge and belief 2012 through 2013 in the county of on or about the date(s) of San Francisco in the Northern Disrict of California , the defendant(s) violated Code Section Offense Description 18 U.S.C. Section 641 18 U.S.C. Section 1343 18 U.S.C. Section 1956(h) 18 U.S.C. Section 208 Theft of Government Property Wire Fraud Money Laundering Conflict of Interest

On March 30th, the United States Department of Justice released a memo[29] revealing that Force used the online handle "French Maid" to convince Ulbricht to pay $100,000 in exchange for information about the Silk Road investigation. Additionally, the memo claims that Bridges used the Bitcoin exchange Mt. Gox to launder $820,000 in government funds for the investigation into personal accounts. On October 16th, Force was sentenced to 78 months in prison by U.S. District Judge Richard Seeborg. Bridges is scheduled to be sentenced in December.


CARL M FORCE (DEA) SHAUN W BRIDGES (USSS)

Features

The site allows users to browse an online market through several categories linked in the sidebar, including drugs, apparel, books, digital goods, drug paraphernalia, erotica and forgeries. The drugs category contains several subcategories, including psychedelics, cannabis, dissociatives, ecstasy, opioids, prescriptions and stimulants. Buyers can register for free without an email but sellers must purchase a special account. Similar to other online marketplaces, users can rate their experiences with individuals sellers to report back if the product they purchased was of sufficient quality and delivered in a timely manner.


Silk Road anonymous marketplace Shop by category: Cannabis (162) Ecstasy(33) Psychedelics( 119) Opioids (33) Stimulants(56) Dissociatives(6) Other(199) | 忝负 1 hit of LSD (blotter) 1/8 oz high quality cannabis B3.17 1.13

TOR

The Silk Road website can only be accessed via TOR anonymous browsing client, which allows its users to browse the Internet anonymously by separating identification and routing, thus concealing network activity from surveillance. The alpha version of the TOR software was announced via FreeHaven.net[9] mailing list on September 20th, 2002, followed by its presentation at the 13th USENIX Security Symposium on August 13th, 2004.


How Tor Works Tor node .. unencrypted link → encrypted link Alice Alice's Tor client picks a random path to destination server. Green links are encrypted, red links are in the clear. Jane Bob

Reception

On June 6th, following the publication of Adrian Chen’s article on Gawker, United States senators Joe Manchin and Charles Schumer sent a letter[10] to the U.S. Attorney General urging law enforcement agencies to shut down the Silk Road website. On June 12th, the Sydney Morning Herald published an article titled “Drugs Bought With Virtual Cash,” reporting that the site would be moving to a new server in order to handle a marked increase in traffic. The article went on to report that Silk Road’s increase in popularity corresponded with a rise in the value of Bitcoins. On July 16th, 2012, Gawker[7]published a follow-up article titled “Are Authorities Closing in on the Online Drug Market Silk Road?”, which reported on rumors that had been circulating about authorities going after Silk Road’s administrator known as “Dread Pirate Roberts.” On June 30, 2013, the site was subject to a DDOS attack which limited access to it through the following day.[14]

Search Interest

External References

[1] Wikipedia – Silk Road

[2] Bitcoin.it – Satoshi Nakamoto

[3] Gmane.org – Bitcoin P2P e-cash paper

[4] Bitcoin.org – Bitcoin

[5] Gawker – Undergrounds Website Where You Can Buy Any Drug Imaginable

[6] Sydney Morning Herald – Drugs bought with virtual cash

[7] Gawker – Are Authorities Closing in on the Online Drug Market Silk Road

[8] MTGox – Bitcoin Exchange

[9] Seul – run an onion proxy now!

[10] Senate.gov – Manchin Urges Federal Law Enforcement to Shut Down Online Black Market for Illegal Drugs

[11] Silk Road – Silk Road Anonymous Market

[12] Arxiv.org – Travling the Silk Road

[13] Gizmodo – Melbourne Man Arrested After Allegedly Importing Drugs Via Silk Road

[14] BBC News – Dark web drugs site Silk Road knocked offline by hacker

[15] The Verge – FBI seizes underground drug market Silk Road, owner indicted in New York

[16] Daily Dot – Silk Road closed: Founder of Dark Web's drug marketplace arrested

[17] Reuters – FBI shuts alleged online drug marketplace Silk Road

[18] Scribd – Ulbricht Criminal Complaint

[19] All Things Vice" – Remember, Remember… Silk Road redux

[20] BBC News – Dark net marketplace Silk Road 'back online'

[21] CNN Money – How Silk Road was reborn

[22] Motherboard – If Silk Road Gets Shut Down, It Will Be Back Online in 15 Minutes

[23] FBI – Operator of Silk Road 2.0 Website Charged

[24] Twitter – @blakeeb

[25] The Daily Dot – Everything we know about the alleged Silk Road 2.0 kingpin

[26] Facebook – Blake Benthall

[27] Instagram – @blakeisblake

[28] The Daily Dot – We spoke to the shady opportunist behind Silk Road 3.0

[29] Justice.gov – Former Federal Agents Charged With Bitcoin Money Laundering and Wire Fraud

[30] Justice.gov – Criminal Complaint

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