This week, it was reported that drug sales on the dark web have tripled since the infamous Silk Road was shut down in 2013.
Within hours of the Silk Road takedown, there were several competitors that were already on the dark web who were ready to move in on the newly available business.
Stijn Hoorens of the RAND corporation recently published a study showing how this growth has occurred despite government intervention.
“Cryptomarkets essentially work similarly to online eCommerce platforms, such as Amazon, but they require encryption software to access and payment in bitcoins. They are dominated by advertisements for illicit substances,” Hoorens explained in a recent press release.
“The closure of Silk Road has not curbed the growth of these cryptomarkets, as more markets continue to be created and more illicit drugs are being bought online. This is despite several high-profile law enforcement interventions and exit scams by market administrators. Cryptomarkets are often online only for several months and users seem to be operating under the assumption that they could be closed at any moment,” Hoorens said.
This constant reinvention of the Silk Road brand, and the myriad of spin-off marketplaces is reminiscent of the battle that took place between online file sharing websites and the global record and film industries. Whenever the government took down a file sharing site, ten more would spring up in its place, making it very difficult for authorities to keep up with the ever-growing connectivity that the internet provides.
According to the press release, other findings from the study showed the following:
- Cryptomarkets were dominated by vendors from the U.S. (35.9 per cent of total drug revenues), the U.K (16.1 per cent), Australia (10.6 per cent), Germany (8.4 per cent) and the Netherlands (7.1 per cent).
- The Netherlands had the highest revenues per capita for illicit drug sales on cryptomarkets, with the country dominating sales of psychedelic drugs, such as MDMA and ecstasy.
- More than half of the vendors made more than $1,000 (€877.2)* per month and the most successful vendor made an estimated $276,230 (€242,307)* in January 2016, a 10-fold increase over the most successful vendor in 2013.
- Vendors have creatively adjusted their behaviour to avoid detection, such as changes in shipping practices.
- Buyers were attracted to cryptomarkets to purchase drugs because of a perceived increase in safety, improved quality and variety, and ease and speed of delivery.
The fact that the Silk Road makes buying and selling drugs safer than the black market is not debatable. However, Hoorens contends that this issue could not be resolved for certain.
“The evidence on the full impact of cryptomarkets remains inconclusive. Some have argued that cryptomarkets reduce violence from the drug supply chain, but others believe that it may offer a new, often young, consumer base easy access to drug markets. Law enforcement agencies that try to curb these markets can use a combination of traditional surveillance operations, postal detection and interception during shipping, and online detection and tracking of the cryptomarkets,” Hoorens said.
Meanwhile, Silk Road founder Ross Ulbricht remains behind bars serving a life sentence — because he created a website.
Ulbricht is among many tech outlaws who found themselves on the wrong side of the law, despite the fact that they never actually committed any crimes.
Most of the original founders of the Pirate Bay are now behind bars on trumped up charges. Many of them were chased to the ends of the earth by international police and arrested on the borders of places like Cambodia and Thailand where they were forced into hiding. Even John Mcafee, the antivirus guru, was allegedly set up for murder in Belize while he was said to be working on NSA-proof software. Likewise, encryption developers are regularly shut down and taken to court by government. Cody Wilson, founder of Defense Distributed has had assets seized, equipment withheld, and websites shut down for pushing the boundaries of 3D printing.
It is fascinating to think of Mark Zuckerberg fleeing to Cambodia and getting arrested by international police at the border. Like them, he is a web developer who owns a website that has changed the world. However, his ideas can be used by the state, and he is willing to play ball with them, so he doesn’t become public enemy #1. However, if you find a way to harness technology that diminishes the power of the state, then you become a target.
This is why the founders of sites like the Silk Road or the Pirate Bay become outlaws, while Mark Zuckerberg becomes a celebrity. This is also why drones that deliver packages or fast food are demonized in the media, while weaponized war drones are presented as just another fact of life. Furthermore, this is why the battle to push technology in the right direction is so important.