Silk Road: The Story of Billions of Dollars, Bitcoin and Idealistic Downfall

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Silk Road will forever remain in the history books as a sound warning to everyone who wishes to have a truly free market.

In order to truly feel the impact of illegal crypto markets, we need to go back to 2011. If there is a word used to describe Silk Road, it would be unique. It was paradise for people looking to forge documents, acquire illegal weapons or buy drugs.

The website was founded in early 2011 by Ross Ulbricht. He was a self-proclaimed libertarian and went by the nickname “Dread Pirate Roberts”. There have been speculations that the account was used by multiple people, but it was never officially proven. The website was operational for more or less 2 and a half years, but it changed everything.

Ulbricht managed to make millions of dollars and become a convict in that time. The scandals and arrests were many and even had 2 US federal agents included. The United States agents were convicted on charges of corruption.

It all sounds like a fairy tale or a desperate Hollywood attempt to make some money because of the recent lack of creativity. The legacy Silk Road left behind, was ultimately not good or evil. It left questions about corruption and how a truly free market affects and warps people. As a matter of fact, Hollywood did manage to monetize the story. In 2015 the Deep Web chronicles which was narrated by Keanu Reeves focused on how the website came to be and its downfall.

Now the Deep Web is a big part of the Internet, but it’s a part which about 99% of the user base never comes into contact with. It basically has all the content, which can get a person in prison. There is no reliable way to measure the size of the Deep Web, but some people say it’s way bigger than mainstream Internet. Access is acquired by using special software, most notably TOR. The program was developed by the United States Navy and it allows anonymous communication online.

Silk Road’s creation was revolutionary

Silk Road and other similar websites, have commonly started to be referred as the dark web. It’s a part of the deep web, which exists on darknets (ie, overlay networks, which can only be accessed by specific software or configurations).

Ulbricht held libertarian world views. He was a keen supporter of US Presidential Candidate Ron Paul, who in turn wanted to abolish the Federal Reserve. Needless to say, Ulbricht didn’t hold favorable views towards the United States government. He often questioned the legitimacy on the United States’ so called “War on Drugs”.

Like many other talented programmers of his age, Ulbricht didn’t find pleasure in switching job after job on graduation. Even though he had a University of Texas degree in physics and a Masters in Engineering from Pennsylvania State University, he could not see himself as an ordinary scientist. That being said, he set out to Sillicon Valley to create his own never-before-seen start-up.

Silk Road was named after the historical trade route which connected Europe and East Asia. It had a simple idea behind it: Make the world a better for everyone. It was designed as an entirely free market. A market so free, that it’s very existence is so outside government reach that it would be a threat to its authority.

He believed that people were free to inject whatever they wanted into their bodies. They were free to do so without having to worry about murderous drug cartels or fear of life in prison. It was pretty much a completely unregulated version of eBay, which sorted users according to their searches. The goods were later delivered by unsuspecting post services.

Thanks to Tor, communication was entirely anonymous and all transactions were done only by bitcoin. At the time bitcoin offered the highest level of anonymity in the world. His vision was that all the products offered resulted in “victimless crimes”. This meant that credit card or ID theft, weapons of mass destruction, bio weapons, child pornography and assassination were banned.

In 2013 it was concluded that about 70% of the website was drugs, but these terms of service didn’t really matter to some of the website’s users. In time the situation escalated and went out of Ulbricht’s control.

Silk Road quickly grew in popularity and started attracting the wrong type of users

The website gained immense popularity and he was forced to lower some of the standards he initially set, like gun trading. The increased weapon regulations were making it harder for people to acquire firearms. That didn’t contrast with his libertarian views so it became a norm.

What made Silk Road more trustworthy than other similar websites was that it allowed users to rate each other. There were also many categories such as quality and price. In general, Ulbricht’s views were genuine and he truly wanted to make the world a better place. However, a very old saying goes:

“The biggest of harm can come from the best of intentions.”

By the time he was arrested, Ulbricht managed to acquire nearly $30 million in personal wealth. It’s also estimated that the website had about $1 billion change ownership during its existence. The authorities were aware of the website’s creation but it took them nearly 2 years to reveal Ulbricht’s identity.

But all good things must come to an end and inevitably Ulbricht was caught red-handed. His alias was traced through the internet to a bitcoin forum and he posted his personal e-mail address there. When he was arrested he was using the Dread Pirate Roberts administration account and he was unknowingly communicating with an undercover FBI agent.

When faced in front of the court, Ross Ulbricht was charged with a whole armada of charges, but among them 6 counts of procuring murder were present. Ironically the website was created as a place to reduce violence reduced to drug trading, but unfortunately the young and idealistic founder was now facing attempted murder charges.

Silk Road’s downfall was also Ulbricht’s as a person

Ulbricht required all of his admins to reveal their real identities to him. One of them was a man called Curtis Green. Green was selling prescription medicine and was arrested.

This made Ulbricht fear that Green would become an informant and he contacted another one of his admins nicknamed “Nob” to assassinate Green. Unfortunately for Ulbricht Nob was a DEA agent. The agent managed to fake the assassination of Green for the price of $40000. Later it was revealed that this wasn’t Ulbricht’s only attempt at hiring the services of hitmen.

Ulbricht was later found guilty on charges of hacking, massive drug trafficking and money laundering. He is currently serving a double life sentence with no possibility of parole. Тhere are many things, which a person can learn from this story.

A person who was set on making the world less violent and wanted to help others, started ordering assassinations 2 years later. It’s ridiculous how much a person can change for such a short time and how ideology can be warped for the wrong reasons.

Cryptocurrencies do have the potential to give the world a truly free market, but Silk Road is a sound warning for the people of tomorrow on what to avoid at all costs.

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