Silk Road 2.0: A Cheap Imitation of the Original

Last week it was announced that law enforcement had again taken down illegal Tor markets. Kudos to law enforcement on their apparent success! Although, they took down several such online market places, the one that caught everyone’s attention was Silk Road 2.0, the heir apparent to the original, shut down a little over a year ago. But has anyone really compared the original Silk Road to 2.0? It appears that 2.0 is a cheap knock off or imitation.

The Original

The first Silk Road was in operation from approximately February 2011 to October 2013, roughly 32 months. It reportedly had total sales of about $1.2 billion, earning $80 million in commissions. It also had over 13,000 in drug listings. When it was initially shut down, 26,000 Bitcoins (BTC) were seized from Silk Road accounts, worth approximately $3.6 million at the time. However, there was also 144,000 BTC, or about $28 million, seized from the purported mastermind. We have little information that it was every hacked, at least to any great extent. We have no information to date its fall was due to an undercover agent working on the inside.

Silk Road 2.0

Silk Road 2.0, operated from about November 2013 to October 2014, roughly about 12 months. One particular month’s sales were noted at $8 million. At a 5% commission, this earned the illegal business about $400,000. However, we can’t say they averaged $8 million a month. In fact, shortly after Silk Road 2.0 start-up it was hacked, losing about $1.5 million in BTC. It reportedly had drug listings of about 14,024. We have information that only about $1 million has been seized at the present time. Finally, the complaint reflects that early on an undercover agent was on board, working with the supposedly more “secure” management team.

Looking at longevity, total sales, and amount seized Silk Road 2.0 pales in comparison to the original. The only area Silk Road 2.0 appears to exceeded the original in was total drug listings. However, more listings did not translate into more money. To be fair to Silk Road 2.0, they clearly had more competition than the original. But I think that success is all negated when one considers they were hacked and had an undercover agent working on the inside.

Now we have news that Silk Road 3.0 has started up. Maybe someone should point out to the new Dread Pirate Roberts that this franchise appears to be a dead end. You can’t spend all those earned BTC commissions very well in prison, particularly if they end up being seized. One thing I would point out though, which kind of sends chills up my spine. Both Silk Road and 2.0, were not run by career drug dealers. They were run by tech savvy individuals, with no brick and mortar drug dealing expertise. With the kind of money being made it will not be long, if it hasn’t happened already, that a traditional drug dealer or gang will decide to go “high tech” into Tor’s marketplace. When that happens, this so called “safe” online market place will become a lot more dangerous for those involved. On that thought, I left a cigar lit somewhere.

Additional Reading

More Than 400 .Onion Addresses, Including Dozens of ‘Dark Market’ Sites, Targeted as Part of Global Enforcement Action on Tor Network

Operator of Silk Road 2.0 Website Charged in Manhattan Federal Court

Original Silk Road Complaint

Silk 2.0 Complaint

Silk Road 3.0 Opens for Business

The FBI’s Plan For The Millions Worth Of Bitcoins Seized From Silk Road

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Silk Road Reload – 3.0 is already up and running

The new main page of what purports to be the reboot of Silk Road says “This is no place for men without souls. We rise again Silk Road 3.0.” Check it out, the new site address is at http://qxvfcavhse45ckpw.onion.

2014-11-07_14-42-08 Redo

 

Who knows if this is a reboot by the 2.0 staff or a total take over of the name and concept by new people. Whatever it is the store is open.

2014-11-07_14-48-10 for sale

 

No doubt that someone is interested in the millions of dollars in Bitcoin possible in the name, The site appears to have reopened with in just two days of the FBI’s take down of the Silk Road 2.0 and many of its competitors. From a business model having all your competitors eliminated in one large law enforcement take down is pretty helpful.

At least the new Dread Pirate Roberts is polite….

2014-11-07_14-45-43 DPR Message

How long until the next hand off to a new DPR….FBI, the ball is in your court.

 

Operation Onymous- What it actually means for law enforcement and the Internet

By now most of the Internet has heard and is digesting the actions of law enforcement agents around the world taking down the infamous Silk Road 2 and other online Tor hidden markets. The question for all of us now is what does this mean in the future? We have been talking about the subject of Internet Investigations for more than two decades. The normal conversation is about how difficult it is and how law enforcement does not have the capacity to stay up with the online criminals. I think this week’s efforts will be game changer in the general investigative philosophy of law enforcers.

What this week has shown the community of law enforcement, as well as the for the criminals, is that law enforcement does have the ability to extend their reach into the darkest places of the Internet. The have the ability to find the criminals, identify them and handcuff them in the real world. Internet investigations have now been brought out into the light of day as a real and productive opportunity for policing in the 21st century. What the average law enforcement investigator needs to take away from this week is that they can go online, they can investigate internet crimes, and they can protect their communities from criminals hiding amongst them using anonymization.

Investigating crimes on the Internet does take some understanding of the technology and it does require training in the proper techniques and skills required to successfully conduct these investigations.

But, these crimes can be investigated…

FBI 2 – Silk Road 0

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Its early in the reporting, but the FBI has announced that they have arrested the new mastermind behind Silk Road 2.0, a BLAKE BENTHALL, a/k/a “Defcon,”. The early reports online are also stating that other sites including Cloud 9, Cannabis Roads Forums and Hydra have been taken down also. The FBI and Homeland Security have been busy. The great part of this, according to the reports, is that the undercover investigator had infiltrated Benthall’s organization and had early on had access to the administrative side of the website.

I am sure there will be more to follow on this case. If you are interested in the escapades of those behind the original Silk Road and the investigation you should check out  Deep Web the Movie.  Author, and digital forensic expert, Todd G. Shipley is working with the production staff on the movie.