A Year After Death of Silk Road, Darknet Markets Are Booming
Jake Swearingen
It's been one year since the FBI shut down Silk Road, the granddaddy of darknet marketplaces, and arrested main Silk Road admin Ross William Ulbricht (or, as he was known online, Dread Pirate Roberts). Silk Road users who navigated to the darknet site on October 2, 2013, found this instead:
For those who relied on the site to anonymously buy everything from pot to AK-47s, it was a bit like trying to log on to Amazon and finding it had shut down overnight. Panic ensued, Bitcoins disappeared into the ether, and users were suddenly forced to find a new place to anonymously shop online for blow or body armor.
There's no denying that Silk Road was an unseemly place. But it was also a centralized one. And in the year since the site's shuttering, the darknet market has fragmented as various new players have attempted to take Silk Road's place, making an already sketchy scene all the more shady. According to a directory of darknet markets on Reddit, more than a dozen are currently operating. And unsurprisingly for markets in which anonymity is vital and nearly every purchase is very much illegal, scams and outright theft have plagued many of the upstarts. In fact, the list of darknet markets not to be trusted is longer than the list of which ones Redditors have deemed reliable.
One early example of how quickly things could turn sour in post-Silk Road era was Sheep Marketplace, which began operating quietly in March of 2013. After Silk Road was shut down, users flocked to the site. For a while, it seemed poised to be the new Silk Road—until a vendor allegedly exploited a vulnerability and made off with $6 million in Bitcoins. The marketplace abruptly shuttered soon after, taking with it all funds stored on the site. Many suspected the site operator to actually be behind the theft. Online sleuths attempted to track the stolen Bitcoins (reportedly worth anywhere from $100 million to $220 million at the time) as the thief attempted to hide his or her tracks.
Or consider the case of Silk Road 2.0, launched on November 6, just over one month after the original Silk Road was shut down. Silk Road 2.0, run by former admins of the original Silk Road, was supposed to be a fresh start. Its fall from grace happened within months—in February of this year the site claimed to have been hacked by one its vendors, who made off with $2.7 million in users' Bitcoins. While the site's administrators have promised to repay everyone who lost funds, many claim they have yet to be repaid.
The list of darknet markets that have suffered from various hacks, thefts, and outright deceit is long and varied. Most have either shut down or are effectively dead due to what appears to be either a lack of competence or an overabundance of greed (or, in some cases, a mixture of the two).
All of this, of course, is in addition to the various scams and ripoffs faced by actual users and vendors on the site, from sellers demanding money up front (normally the money is held in escrow until the items are delivered) to buyers refusing to pay vendors. And while online drug shopping may seem safer to both the buyer and seller than scoring drugs on the street, there's still significant amounts of risk. In May, Jeremy Donagal, who went by the moniker "Xanax King," was arrested along with eight others, charged with selling hundreds of thousands of bars of the powerful anti-anxiety drug through darknet markets. (It should be no surprise that within days of his arrest, users were already posting lists of the "new Xanax Kings.")
Indeed, despite scams and worries about law enforcement cracking down, darknet markets continue to hum along. Agora Marketplace, perhaps the most trusted of the modern darknet markets, seems from every indication to be doing brisk business. (Most darknet markets take a commission of every sale made via its services.) Within minutes of downloading the Tor brower and finding a referral code, I was able to quickly skim through hundreds of listings of everything from shotguns to barbiturates.
For instance, for just $85, I could purchase a half-gram of black tar heroin. One user reports: "Dope wasn't super strong but transaction was smooth."
For $2,570, I could by a Škorpion vz. 61, a Czech-made submachine gun. This same gun could be bought in the U.S. for about $950—most darknet gun sales are aimed at European users who face significantly stricter gun control laws.
The most fascinating section of many darknet markets, however, is the "Information" section. While the Internet effectively offers nearly every bit of information you could dream of for free, there appears to be a thriving black market for certain types of knowledge. For instance, for 99 cents (or about .0087 Bitcoins at current valuation prices), I could purchase a book on building secret hiding places.
Or, that staple of every teenager's online life in the dial-up days of the '90s, The Anarchist's Cookbook, can be had for $1.58.
At DeepDotWeb, an anonymous editor chronicles everything darknet related, from the latest in cryptocurrencies to the rise of fall of new darknet markets. In an email interview, the editor (who asked to remain anonymous) predicts that the crazy explosion of smaller markets may be on the wane. "The market was pretty stable for the last few month unlike first six months of 2014," he writes. "I believe that it will stay pretty much the same with some markets popping up and some shutting down from this reason or another until we will see some new technology—probably one that will offer decentralization of the markets."
And despite theft, scams, and news of arrests, he says more and more people are using darknet markets. "There are no reliable numbers about [the number of users] unless a large market owner will share them, but this I can tell you for sure: The number have grown by a huge amount of users ... The amount of media exposure the darknet markets had this year is unbelievable and the amount of traffic I see as a clearnet site that is looking for those markets is huge. It's almost mainstream nowadays."
In other words, while the feds may have successfully shuttered Silk Road and put Ross William Ulbricht behind bars while he awaits trial, business for online black markets is better than ever.
