Buying Drugs Online Remains Easy, 2 Years After FBI Killed S
Source: Steven Nelson
Two years ago, federal agents apprehended Ross Ulbricht at a public library in San Francisco and shuttered the pioneering online market Silk Road. He’s now serving a life sentence in prison for running the digital drug bazaar, but the market’s vision of unregulated commerce lives on.
Without much effort, almost anyone with Internet access can order illegal drugs from customer-reviewed vendors on the so-called "deep Web." Download the Tor anonymous browser, buy the digital currency bitcoin and a few clicks later cocaine, pot or pills could be headed to your doorstep.
“It’s an idea, like social networking, that you wouldn’t think very much of until it happens. Then you can’t imagine people giving it up,” says Johns Hopkins University computer science professor Matthew Green. “The easiest way to think about Silk Road is to view it as a proof of concept for later darknet markets.”
Darknet markets, in theory, offer greater product reliability and remove the risk of physical violence in face-to-face encounters with drug dealers. Some Silk Road successors host items like stolen credit card information and Netflix accounts, but a majority of listings remain focused on drugs, which vendors ship with ordinary mail delivery services.
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“The complexity of opening a new marketplace after Silk Road was reduced to the task of imitating them,” says Carnegie Mellon University researcher Kyle Soska, a doctoral candidate in electrical computer engineering.
“To this day, more than half of anonymous marketplaces implement websites that are directly derived from the template that Silk Road used, and from formatting all the way to policy Silk Road invented the status quo that actors in this space have come to expect,” he says.
Soska and his adviser, Professor Nicolas Christin, co-authored a study released earlier this year that analyzed the size of darknet markets, finding they do brisk business, with relatively stable sales averaging $300,000-$500,000 a day �C a huge bump from Silk Road's experimental beginnings in early 2011 with sales of psychedelic mushrooms.
The breakdown of drugs being sold also is relatively stable, Soska and Christin found, with marijuana consistently accounting for about a quarter of sales, followed by MDMA (more commonly known as ecstasy or Molly) and stimulants. Sales of psychedelic drugs, prescription medication and opioids are also significant, their research shows.
The top 1 percent of vendors are responsible for more than half of sales, Soska said during an August presentation, with a few dozen clearing $1 million in recorded deals.
Since the demise of Silk Road, theft by market operators, deceit by vendors and arrest by authorities have been significant risks for market participants. Participation tends to drop after major law enforcement busts or massive scams, but then rebound with new market leaders.
One of the leading markets to pick up after Silk Road, Sheep Marketplace, closed in late 2013 after a vendor stole $6 million worth of bitcoin. Another, Black Market Reloaded, voluntarily closed. Silk Road 2.0 then emerged as market leader until alleged founder Blake Benthall's November 2014 arrest in an international law enforcement operation that affected some �C but not all �C darknet markets.
Evolution, subsequently the largest market, closed in March with operators suspected of stealing payments stored in escrow that were intended for vendors. Agora, a relatively clunky site that took over as market leader, closed in August for purported security upgrades, with operators cautioning users to withdraw funds.
“The basic strategy new market operators are using appears to be, essentially, to not stay in business too long,” Green says. “There’s a lot of demand, so people will take financial risks.”
Digital Citizens Alliance Research Director Dan Palumbo, who tracks darknet sites, says the current leader is AlphaBay Market, followed by Abraxas and the Nucleus Market �C each of which, he says, have grown significantly since Agora shut down, with vendors changing platforms.
AlphaBay had 21,372 drug listings on Thursday afternoon, followed by Abraxas at about 16,000 and Nucleus with nearly 13,000. The listings don't directly correspond with sales volume (Soska and Christin analyzed often-mandatory buyer feedback instead, though they haven't released fresh data), but the listings do appear to reflect a growth in darknet commerce.
At the time Silk Road was seized in October 2013, it had 13,000 drug listings, followed by Black Market Reloaded pushing 3,567 drug listings and Sheep Marketplace with close to 1,500, according to figures from the Digital Citizens Alliance.
Drug listings Other items Total
AlphaBay Market 21,372 20,538 41,910
Abraxas 16,251 8,724 24,975
Nucleus Market 12,929 9,505 22,434
The number of listings on the top three darknet markets, as of Oct. 1, 2015. The numbers, from Dan Palumbo of the Digital Citizens Alliance, offer a rough picture of the current market leaders.
People who buy the drugs aren't always shy about discussing it. Customers use special forums and reddit to boast of successes and, sometimes, to warn others when authorities have intercepted a package.
"I'm more addicted to ordering and collecting drugs than any of the actual drugs I've ordered," an enthusiast confided Thursday on the subreddit DarkNetMarkets, to much agreement from peers. "What type of monster have I become?"
Sales on darknet markets appear to be strong, but the growth hasn't been explosive, particularly given the large global user base for illegal drugs.
"One thing that's very interesting is that after two years the problem has not gotten significantly worse,” says Nicholas Weaver, a professor of computer science at the University of California at Berkeley. “New markets come and go, new markets get busted or take the money and run, but at the same time, the problem hasn't exploded.”
Key pieces of evidence used against Ulbricht at trial may prove instructive for would-be black marketeers. It’s a bad idea, evidence and testimony suggest, to tell friends what you’re doing, to keep a journal of your work and to inadvertently leak the IP address of your server.
Weaver isn’t convinced, however, that criminals have much to learn from the prosecution.
“Bad guys who don't know Stringer Bell's maxim are actually few and far between,” he says, referring to a fictional gang leader’s warning against taking notes about a criminal conspiracy in the TV show “The Wire.”
“If anything,” Weaver says, “the arrest of Blake Benthall shows that you can have even dumber criminals the second time around.” Authorities reportedly infiltrated Silk Road 2.0 and located its servers by corrupting the Tor network's system of disguising user IP addresses. “Benthall lived large," Weaver adds, "but he directly connected to his server on a regular basis, from his own hotel room when traveling.”
“Overall,” he says, “the Silk Road trial [of Ulbricht] gave a map to the future in prosecutions involving bitcoin. ... Before the trial, prosecutors didn't understand that [bitcoin] wallet files don't just represent the bitcoins to seize, but also act to index the entire transaction history for the bitcoins.”
Ulbricht reportedly chose not to take measures to conceal the bitcoin he transferred to his personal wallet, but Weaver says that’s irrelevant once authorities seize a wallet.
With the risk of life imprisonment for running a market and tough penalties for buying illegal drugs if caught, why would anyone take the risk of participating in a darknet market?
Dalai Lama-themed LSD is being sold on the AlphaBay, currently the largest darknet market
Dalai Lama-themed LSD is being sold on the AlphaBay, currently the largest darknet market
“Well, because they can’t buy legally,” reasons Harvard University economist Jeffrey Miron, who supports drug legalization. “And for some, the thrill of defying big government.”
Green says there are a couple clear legacies and lessons from the original Silk Road, including that it would be wise for site operators to live outside the U.S., preferably in a jurisdiction unlikely to cooperate with American authorities.
“I think the lesson of Silk Road is that it’s very hard for the FBI to track and shut down a market like this, but that given enough time they will manage to do it,” he says. “Silk Road was designed by an amateur PHP [scripting language] programmer who made a lot of basic mistakes. Later market operators probably have better protections in place, and more layers of anonymity to protect them even if the server is compromised.”
But as the new normal of turbulence after Silk Road’s two-year reign as undisputed and trusted market leader sets in, Soska says he’s detected what appears to be efforts to forgo a least some degree of privacy in exchange for enhanced reputation, pointing to subtle changes like giving more specific time stamps for customer reviews.
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“The idea of a [darknet market] is something we’re probably never going to be free of, as long as the mail system exists to actually deliver the products,” Green says. “What I think will happen is that over time the set of people who run these sites will change."
Rather than libertarian techies, unreliable thieves and others initially building darknet markets, Green says he "can imagine a world where major drug cartels run them directly, or indirectly, which would make it awfully hard for U.S. law enforcement to arrest the operators.”
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But although the sophistication of markets may increase, experts don't believe it's possible to make such a site impenetrable to authorities.
"Of course not," says cryptographer and privacy expert Bruce Schneier. "You won't find anyone who believes in that sort of magic."
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