The feds have caught up to the Silk Road. The underground website long known for drug trafficking and other illegal activity was seized by the FBI who also arrested the owner on three criminal counts. New York State prosecutors charged Ross William Ulbricht with one count each of narcotics trafficking conspiracy, computer hacking conspiracy and money laundering conspiracy, according to a court filing.
Update: Further examining of the court documents revealed that Ulbricht solicited for murder after a Silk Road user threatened to reveal user info. More Info Here.
Silk Road has long existed in the corner of the Internet dubbed Deep Web and accessible only through the seemingly secure Tor Network. Launched in 2011, the site quickly gained notoriety for its shadowy marketplace of drugs and guns. Silk Road became the Amazon of illegal things. As of July 23, 2013, there were approximately 957,079 registered user accounts, and as the court docs note, this does not necessarily equal the number of actual users.
Although obscured, Silk Road netted big money. The total revenue generated from launch until July 23, 2013, resulted in approximately 9,519,664 Bitcoins and 614,305 Bitcoins of commission for Silk Road itself, court documents reveal. That converts to roughly $1.2 billion in revenue and $79.8 million in commissions, at current Bitcoin prices.
A Silk Road competitor, Atlantis, aimed to add a bit of whimsy and Web 2.0 marketing pizzazz to the same markets. It closed last month.
As the court documents note, the owner of Silk Road, Ross William Ulbricht, intentionally and knowingly violated U.S. narcotics laws. The document, available here, reads:
From in or about 2011, up to and including in or about September 2013, ROSS WILLIAM ULBRICHT, a/k/a “Dread Pirate Roberts,” a/k/a “DPR,” a/k/a “Silk Road,” the defendant, owned and operated an underground website, known as “Silk Road,” that provided a platform for drug dealers around the world to sell a wide variety of controlled substances via the Internet.
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But that’s just the start of Ulbricht’s troubles. He is also charged with hacking conspiracy and money laundering. The site is currently down, seized by the FBI. It should be interesting, however, to see how the government handles this hydra of an organization. The vast majority of interactions on the Silk Road are anonymous, performed using Bitcoin transfers between parties and set up in secure email exchanges.
According to the court documents, law enforcement agents made over 100 individual undercover purchases through Silk Road, obtaining Schedule I and II drugs, including ecstasy, cocaine, heroin, LSD and others.
Ulbricht was reportedly arrested yesterday, October 1, 2013, at the Glenn Park library in San Francisco.
Additional coverage
Court Docs Reveal Silk Road Founder’s Alleged Murder-For-Hire Plot
Matt Burns is a longtime technology journalist, now Editorial Director at Insight Media Group and formerly Managing Editor at TechCrunch. At Insight Media Group, he guides coverage and contributor programs across fast-growing tech publications. Before that, he spent 15+ years at TechCrunch, rising from contributor to Managing Editor, helping scale the newsroom and program Disrupt’s stages and TechCrunch’s other events. Earlier, he also wrote for Engadget. Matt co-founded the Resilience Conference, an event series at the intersection of defense, security, and startup innovation. There he builds agendas, hosts sessions, and launched “Launch @ Resilience,” a showcase for early-stage teams building nation-defending technology. Across roles, he’s reported on and moderated conversations in AI, mobility, frontier tech, and the hard problems technology companies face. He’s interviewed world leaders, top investors, startup founders, and public-company CEOs. Lifelong Michiganian with plenty of Silicon Valley miles, he brings Midwest empathy and an editor’s eye. Offstage, he works with teams to sharpen narrative and validate go-to-market plans, and, when possible, camping along Lake Michigan.