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Silk Road successors

economist.com

62 pointsSimplyUseless28 comments

ROSS ULBRICHT has been sentenced to life in jail for his role in the Silk Road.

This article shows what a waste of resources this trail was. Online markets for illegal substances are going to follow the path of file sharing, both are nearly impossible to stop.

"Closing down the web’s biggest drug shop has simply cleared the way for competitors."

Truth. It’s like how ridiculous shutting down Napster was.

However, it does set a precedent for future things of this nature. For example, shutting down Megaupload caused a lot of other file-sharing websites to shutdown or clean up their act for fear of a larger crackdown. If anyone thinks they can just run a website like Silk Road and get away with it longterm for the sake of just being a middleman (like the file-sharing networks were), it’s now been demonstrated what kind of attention that will raise.

Good point... this trial will not stop anything, just the nature of how things move forward from here... Perhaps in the future, these markets will be even more decentralized, like torrents have changed sharing sites. There is now a huge incentive to run these markets from places like Russia or Mexico.

"This trial will not stop anything" may or may not be true, but the trial is also about bringing justice for what was done, and punish for the crime that was committed. If a murder was committed, a trial may not stop future murders, but surely you agree that we must bring the murderer to trial. By selling drugs and conspiring to murder, Ulbricht must stand trial, even if there will be another drug dealer tomorrow.

This is an interesting perspective on just "how much of a crime" that was:

http://blog.erratasec.com/2015/06/some-notes-about-ulbricht-...

I haven't followed this too closely, and maybe he is guilty of attempting to murder people and such, but it does look like the government/judge wanted to punish him with a life sentence mostly for the the fact that he created a "drug market outside the reach of the law" (or whatever).

Ars covered this much better than did Wired [1]. That's what you want to read to get a decent picture of the factors that went into his sentence (assuming you don't get a copy of the court transcript and read that).

[1] http://arstechnica.com/tech-policy/2015/05/ulbricht-at-sente...

If we follow that logic there are a few large players that are missing from your line of thought-

Ulbrich is a small fish in huge pond when compared to the large unnamed players who get of with small reprimands and fines.

How a big US bank laundered billions from Mexico's murderous drug gangs

http://www.theguardian.com/world/2011/apr/03/us-bank-mexico-...

Shutting down Megaupload also caused a lot of people to move back to torrents. At that time, direct download websites were quite trendy and most of the trafic was redirected to torrents after.

Those charts on the Economist showing how new markets fill the empty space left by Silk Road are very similar to some charts from a recent EU study on piracy:

https://torrentfreak.com/shutting-down-pirate-sites-is-ineff...

Short of somehow controlling the creation of these "services" in the first place (rather than trying to block them after the fact), it doesn't look like they can be stopped as long as the demand is there.

Uhm no what caused problems was Visa/Mastercard/Paypal stopping payment processing for filehosting site (even ones that were "clean" )

Yes and no. Closing it down has made it clear you can't have a long-running drug store. This has greatly increased the incentive to exit scam your customers.

In file sharing, no money changes hands. In Silk Road, bitcoin changes hands, leaving a permanent public record. You can safely assume that, just as there is a department working out who is today's "Al Quaeda #1" so they can drone strike him, there will be a department devoted to tracking the most popular online drug vendor of the day.

No, it proved that you can't have poorly-run drug stores.

The exit scams are because demand is greater than supply. The centralization is what makes them possible. The same thing would be possible if every coke dealer did the same thing in an area.

A distributed system would be better.

You mean like this? https://github.com/OpenBazaar/OpenBazaar

Nope, but I like my idea so much that I'm going to keep it to myself. :)

> Online markets for illegal substances are going to follow the path of file sharing, both are nearly impossible to stop.

The former are actually massively easier to stop than the latter. They have too many moving parts, too much involvement with moving physical goods around, and involve too many unreliable people with conflicting interests to prevent infiltration and to prevent betrayal from within.

But the marketplace doesn't need to be involved in most of that. Apart from dispute resolution the marketplace doesn't need to be concerned with the specifics of drug selling; just like ebay isn't very involved in watch selling despite offering a marketplace for it.

Sure, it's relatively easy to bust individual vendors, but that's similar to busting a street dealer: most of the time not a big deal.

Can you imagine what if someone open sources these kind of websites? Then pretty much every big shot drug dealer would have their own copy without needing much tech expertise. Silk Road got busted in part because DPR failed to fix bugs that caused IP leaks. But if it was open sources then these bugs would have been quickly fixed and busts would become increasingly challenging. I think DPR's vision is undeniable. Ultimately, the invention of Internet is leading to free choices that can no longer be suppressed by laws or even morality of situation - whether we like it or not. The ethical questions such as what if children uses these websites or what if your brother became heroin addict because of it - these questions would painfully be mute in face of technological reality that will be enforced upon us. In effect, we are slowly but steadily moving towards a framework that is dramatically going to be different than traditional governments, regulated economics, monopolized currencies, power hierarchy, bureaucracy, rather indirect democracy and laws crafted for vested interests as opposed to people themselves. There seems to be some purer form of laws that seems to be taking form all by itself that won't be human manufactured and probably would be as enforcing, universal and powerful as laws of nature itself - at least as long as we allow technology to exist.

I don't think that the software itself is the hardest part.

I think the proper OPSEC in all parts of the process (hosting, finding mods, finding first customers,... ) is much harder, and cannot be really open-sourced.

But of course I have 0 experience in running a darknet website.

Check out OpenBazaar. It's a fully decentralized / FLOSS marketplace. Regarding the potential for it to be abused, check out this article on their blog: https://blog.openbazaar.org/bitcoin-free-trade-and-terrible-...

Isn't this Pirate Bay's model?

Open source everything so it can be run from servers in drones, etc.

That one chart single handedly shows how permanent the idea of online drug markets are and also how attractive the field currently is for further innovation. It shows a market with high turn-over which to the minds of a geeky criminal translates to the question "can I do it better and survive longer?"

As a .gov I'd be concerned that the eventual party that does get it right, might have state support. A situation where instead of paying the bills of drug addiction therapists within the site, as Silkroad did, it would ban them outright.

A response to this inevitable progress would be: A Silkroad where reputation is tied to responsible drug use. Where irresponsible use, at worse, lands a therapist at your door rather than police dogs. By turning dark markets into a means of rehabilitation the justification for official support becomes clear and would further reduce the market available to more vicious forms of organized crime.

Why doesn't North Korea set up a drug marketplace? It would be diplomatically impossible to shut down and it would bring in valuable hard currency. Some users would be put off by funding oppression but others would flock to having certainty guarantees. NK apparently trains enough security engineers that building this isn't outside of their scope.

http://www.deepdotweb.com/2015/04/01/democratic-peoples-repu...

How do you know they haven't?

I wonder at what point the Drug Cartels just will start running Darknet sites themselves. It would be a new thing for them, but many of the Mexican cartels are actually very technically sophisticated (including running their own telecommunications networks).

I imagine taking down a darknet site run by groups with that sort of power would be near impossible.

"Drug Cartels just will start running Darknet sites"

It's not their comparative advantage. Cartels have big overhead expenses in men with guns. Mexican wages are rapidly converging on first world wages and men have to be paid to take risks. Mexican youth police trainees are already getting US$3-4 an hour and that rises rapidly with experience.

No, I expect darknet sites will mostly be small time individual competent tech operators earning their eff ewe money and then destroying the evidence or continuing until greed gets them jailed. Or perhaps some will follow the model of the true Dread Pirate Roberts and pass on the torch.

Of course, operating from a honey badger foreign country is always an option, too.

That's an interesting point. One could look at Cartels as also having a comparative advantage in subverting the power of political and judicial processes, which does give then an advantage in running darknet sites.

Your prediction on who will be running the sites seems credible though - I imagine the groups running them will become increasingly sophisticated over time, the potential profits certainly justify it.

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