Silk Road

 Silk Road was an anonymous online trading platform located in the zone .onion of the anonymous tor network and worked from 2011 to 2013. Most of the products was to prove to delegate, however, recently site banned pair-the sale of raw details of bank cards, about money, children’s section, personal data, services of a killer and a weapon. The site was best known as a platform for the trade of illicit psychoactive, which are costly 70% of the goods, in addition they prove other commodities, including legal, for example, a paragraph or an electronic copy of forbidden books.

                                                                

Description

 Buyers and sellers conduct all monetary transactions through Bitcoin cryptocurrency, which in combination with Tor can ensure the anonymity of participants in the transaction and the inability to block payment. Buyers register on silk road for free, and sellers are required to purchase an account via an auction to reduce the risk of fraud

History

The website launched in February 2011; development had begun six months prior. It is held to be part of the Deep Web. Silk Road was operated by “Dread Pirate Roberts” (named after the fictional character from The Princess Bride), who was known for espousing libertarian ideals and criticizing regulation.

Initially, buyers could register for free, but there were a limited number of new seller accounts available; new sellers had to purchase an account via an auction. Later, a fixed fee for each new seller account was chosen to mitigate the possibility of malicious individuals distributing tainted goods.

On October 2, 2013, the FBI shut down Silk Road. They arrested Ross William Ulbricht on charges of alleged murder-for-hire and narcotics trafficking violation and identified him as the founder and chief operator “Dread Pirate Roberts.” On 6 November 2013 Forbes and Vice reported that Silk Road 2.0 was online and being run by former administrators of Silk Road and that a different user was now using the name, Dread Pirate Roberts. 

 

Products

As of March 2013, the site had 10,000 products for sale by vendors, 70% were drugs that are considered contraband in most jurisdictions. 340 varieties of drugs were being sold, including heroin, LSD, and cannabis. There were also legal goods and services for sale, such as apparel, art, books, cigarettes, erotica, jewelry, and writing services. A sister site, called “The Armory”, sold weapons (primarily guns) during 2012 but was shut down due to a lack of demand.

Sales

The criminal complaint published when Ulbricht was arrested included information the FBI gained from a system image of the Silk Road server collected on 23 July 2013. It noted that, “From February 6, 2011 to July 23, 2013 there were approximately 1,229,465 transactions completed on the site. The total revenue generated from these sales was 9,519,664 Bitcoins, and the total commissions collected by Silk Road from the sales amounted to 614,305 Bitcoins. These figures are equivalent to roughly $1.2 billion in revenue and $79.8 million in commissions, at current Bitcoin exchange rates…”, according to the September 2013 complaint, and involved 146,946 buyers and 3,877 vendors. According to information users provided upon registering, 30 percent were from the United States, 27 percent chose to be “undeclared,” and beyond that, in descending order of prevalence: the United Kingdom, Australia, Germany, Canada, Sweden, France, Russia, Italy, and the Netherlands.

Interesting facts

 

• The total volume of transactions on the site for 2.5 years amounted to 9.5 million bitcoins, which is comparable to the total number of bitcoins at the time of closure of the site, that is, 11.75 million with about 78% of bitcoins from their total never used in any turnover. According to the FBI, this ratio between the volume of transactions on the site and the number of bitcoins may indicate that the main use of cryptocurrency, with the exception of speculative investments, was the purchase of illegal goods.
• The largest investors in bitcoins Winkelvoss brothers planning to launch Winkelvoss Bitcoin Trust in the United States after obtaining permission, associate the growth of the bitcoin rate (as of January 22, 2014 8 times) after the closure of Silk Road with the fact that bitcoin has ceased to be associated with the shadow market. Cameron Winkelvoss in his online interview with Reddit users gave an assessment of Silk Road’s turnover in the bitcoin economy. In his opinion, it amounted to 4 %.
• In 2013, Forbes magazine wrote about similar small shops Atlantis and Black Market Reloaded. Currently they are both closed by their owners. Another similar shop Sheep Marketplace shut down after break-in and steal 5400 bitcoins from him.
• This website was cited at the 2011 SOPA amendment hearings as an example of the evolution of some websites into distributed networks and computer systems that cannot be blocked in a constructive way by the domain filtering method proposed in SOPA.

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