Using computers instead of camels, the ''Deep Web’' rather than the Indian Ocean, and Bitcoin instead of Roman currency, 21st century drug traffickers are now traveling a Silk Road of their own.
A growing number of Internet-savvy criminals are using programs like Tor, a sort of Internet cloaking device, to hide their activities on websites inaccessible to conventional web browsers.
Tor, which is available for download on any computer, allows users to surf the web anonymously. Users can set up sites that can only be accessed using Tor, and these sites form the space for the Deep Web. Anonymity and encryption has offered the Internet’s savvier users a chance to develop marketplaces at which people can order just about anything – controlled substances included – for delivery to their doors. Until recently, it seemed beyond the reach of law enforcement.
One such marketplace, studied by computer scientist and Carnegie Mellon University professor Nicholas Christin in 2012, goes by the name ''Silk Road.'' By Christin’s estimates, during an eight-month period last year, drug traffickers on Silk Road completed transactions totaling $15.2 million.
The Drug Enforcement Administration has taken notice, and the agency’s Los Angeles field office is already making moves. But to shut down the site’s drug trafficking, the investigators need a paper trail. For that, they needed to get their hands on some Bitcoin, the currency used on Silk Road.
Bitcoin is a virtual online currency unconnected to any asset. It gains its value from a complex mathematical process that Bitcoin ''miners’' solve with computers dedicated to the problem.
The equation is set to automatically increase in difficulty until a certain number of Bitcoins are produced, which regulates the supply. Demand is already in place online: Users can buy Bitcoin with U.S. dollars or other currencies from other users.
Every time the Bitcoin changes hands the transaction is recorded in what is called the Block Chain. Because of that, many Silk Road users ''scramble’' their bitcoin before a purchase, essentially adding so many transactions to the Block Chain that the transaction in exchange for drugs is untraceable. For many, purchase and delivery of illicit drugs go off without a hitch.
To get to the Silk Road, a user opens Tor and plugs in a deep web URL, in this case the words ''silk road’' followed by a string of numbers and letters. In a matter of seconds, the user can browse thousands of posts offering all manner of controlled substances from marijuana and cocaine to prescription drugs like Valium and Klonopin.
Not everything sold on Silk Road is illicit. Users can also buy books, computer parts and tobacco – ''anything but child pornography, assassinations and stolen goods,'' according to the site’s administrator, who operates under the alias Dread Pirate Roberts.
''Roberts’' notes in a welcome message that there are some rules, but not many. ''You will find easy access to things that could get you in trouble with your authorities and are downright terrible for your health,'' the administrator writes. ''Just because you can, doesn’t mean you should. However ... it’s your job to judge what is good and bad for you. No one else can do that.''
In some Internet circles, Roberts is a folk hero on par with Julian Assange, Edward Snowden or the founder of Bitcoin, also known only by an alias Satashi Nakamoto. ''Roberts,'' like ''Nakamoto,'' is presented as a radical libertarian.
''The same principles that have allowed Silk Road to flourish can do work anywhere human beings come together,'' ''Roberts’' wrote on Silk Road’s forums on October 1, 2012, according to a Forbes blog post. ''The only difference is the State can’t get its thieving murderous mitts on it.''
And flourish it has, Christin estimates that in the year since his study, Silk Road has more than doubled in size.
It isn’t as if Silk Road has not attracted attention. Sen. Charles Schumer, D-N.Y., and Sen. Joe Manchin, D-W.Va., sought to bring the site to the attention of law enforcement in June 2011, several months after the site was founded. The lawmakers called on U.S. Attorney General Eric Holder and the D.E.A. to seize the Silk Road domain name and kill the market.
That is not technically possible, Christin said. Because the site is on Tor, there is no conventional domain name to seize.
''We have been in close contact with the DEA and are confident they are aware of the problem, but it’s clear they need to do more,'' Matt House, a Schumer spokesman, said on Friday.
Christin said that Silk Road has grown mostly unimpeded since 2011. If the site has problems, they are scalability issues due to the popularity boom, not law enforcement interventions.
''Nothing has happened to it,'' Christin said. ''So are the federal agencies trying? Or are they being outsmarted?''
They are trying, and they’re catching up.
The DEA announced on June 23 that it had seized 11.02 Bitcoins, valued at $814.22, from a Silk Road vendor operating under the pseudonym ''Casey Jones,'' allegedly Eric Daniel Hughes, 31, of Charleston, S.C., who was charged with illegal distribution of marijuana and Clonazepam, a powerful sedative. His attorney has denied Hughes is the person who made the illegal Bitcoin sale.
A call to DEA headquarters asking about the Bitcoin seizure was referred to California, where the DEA’s Los Angeles field division is overseeing the investigation.
''I can tell you that this office and the DEA are well aware of what’s out there,'' Assistant U.S. Attorney Kevin Rosenberg said. ''There are agents ... dedicated to working on these cases.''
A DEA spokeswoman on Thursday declined to comment on what it called an ongoing investigation.
Rosenberg is currently prosecuting a ring of suspected drug traffickers as a result of one of the L.A. division’s investigations into a website like Silk Road called Farmer’s Market.
The methods used by the DEA in the Farmers Market case are very similar to those it is using in the investigation that led to the seizure of 11.02 Bitcoins in April.
According to an indictment for conspiracy charges, Michael Evron, an American citizen, and Marc Willems from the Netherlands, had begun a correspondence about what the DEA calls an ''online controlled substances marketplace’' in July of 2006. Weeks later, the DEA alleges, they had opened for business a drug trafficking service called Adamflowers.
Adamflowers and Farmer’s Market were much more rudimentary than Silk Road. After browsing a web page with drug ''menus,'' customers would send an encrypted email to Willems and Evron with their order. Willems and Evron and several collaborators would then handle a monetary transaction – mostly done with Western Union wire transfers and trades in virtual notes backed by gold – between the customer and a supplier. The drugs would then be sent through the mail from the supplier to the customer.
Between 2008 and 2009, Willems paid himself, Evron, and suppliers $118,575 and 49,511 euros using Pecunix, one such virtual gold-based currency. Between 2007 and 2009, according to authorities’ estimates, the marketplace had handled 5,256 orders valued at $1,041,244. According to the indictment, LSD and MDMA (Ecstasy) were the drugs most frequently traded on the site.
As drug trafficking goes, it was a small operation, and according to authorities supply shortages plagued the site. When an undercover DEA agent infiltrated Adamflowers by mimicking the behavior of other customers, using email encryption and placing orders, Willems and Evron allegedly had to offer site credit instead of delivering on a bulk order of MDMA. The agent was forced to give up on the order and opted for batch of LSD instead, which still didn’t arrive for months.
For sticking with the site despite the trouble, an alleged co-conspirator later cut the agent a deal on another order of LSD ''because (the undercover agent) was a good customer.''
Understanding Tor requires an understanding of IP addresses. Every computer using the internet is assigned an IP address, a series of numbers between 0 and 225 separated by periods. Internet Service Providers use the address to direct Internet traffic to and from their customers’ computers. Tor creates a chain of relays, or a series of computers also using Tor, to spread IP addresses around the world. By the time a Tor user visits a site, the IP address recorded by that site’s servers is untraceable to the user’s computer.
The switch to Tor was too late for Willems and his alleged co-conspirators. DEA agents had already begun their investigation. By April 2012, federal agents had enough information about both Farmer’s Market and Adamflowers to arrest him, Evron and six of their alleged collaborators.
The bust, dubbed Operation Adam Bomb by the DEA, was touted as the first of its kind. The group was charged with conspiracy to distribute controlled substances. Their trial is scheduled for November.
It was a big moment for the L.A. division of the DEA, which had spearheaded an investigation in which many U.S. and foreign law-enforcement agencies played a part. The Willems indictment shows that agents infiltrated the site by mimicking other customers and placing orders. Then, they followed the money: Agents were able to track transactions on Pecunix and Western Union.
At least one online currency accepted on Farmer’s Market is now defunct because of this perceived weakness. iGolder, similar to Pecunix in that it allowed users to trade virtual notes backed by gold, currently notes on its website that the currency will be shutting down on Aug. 1 with a message outlining its ''central point of failure.''
''Our server may be raided by thugs wearing some kind of uniform,'' the message reads. ''We feel it is safer for us to cease operations.''
The site’s suggestion for its soon-to-be-former users? Buy Bitcoin.
''Bitcoin came out and we realized that a currency backed by nothing is far better,'' JC Morin, an iGolder administrator, said in a Skype conversation. ''Because nothing can be seized or stolen.''
To those using the currency that appeared to be true, until April.
Silk Road’s forums lit up with the news about the DEA’s Bitcoin seizure with many newer Silk Road users asking veterans if they should be worried. The veterans, in return, speculated about the DEA’s actions.
''If I was a cop tasked with bringing down Tor forums, I’d be cashing out people’s Bitcoins so there would be a money trail,'' a user on Silk Road’s forum for security posted under the name ''comsec’' on July 3.
The Bitcoin seized in April by the DEA has already been traded for cash, which sits in an account in the Department of Justice.
''If you declare that bitcoin is actually a currency, there are a lot of laws that apply to it,'' Christin said.
In its press release announcing the Bitcoin seizure, the DEA says, ''Traffickers of illegal drugs may attempt to operate online in secrecy, utilizing special networks, anonymizers, and covert currency transactions.
''But none of that is beyond our reach.''
Dread Pirate Roberts
Who is Dread Pirate Roberts? And why did the ringleader of a global drug-trafficking network on the ''Deep Web’' take a moniker from The Princess Bride?
In the books and cult classic 1987 movie of the same name, Dread Pirate Roberts is a feared marauder that takes no prisoners in his exploits on the high seas. It’s ultimately revealed that the pseudonym refers not to a single pirate, but several in a line of succession.
The DEA, predictably, is not amused. An agency spokeswoman declined to comment on how close investigators might be to discovering the identity of the person or persons responsible for the site.
In the meantime, musing on the identity provides the site’s drug-buying clientele with some entertainment.
In a Silk Road forum thread called ''Crackpot Theories on the Identity of DPR,'' Silk Road users explain how they conceive of the leader.
''I like to think DPR is like the guy from A Clockwork Orange, but not so evil,'' one user writes. Another invokes the image of Sean Connery for the ''Roberts’' persona. In almost every characterization, DPR is a man – perhaps reflecting the male dominance and sexism of online and tech communities.
What is known is that ''Roberts’' professes to be a radical libertarian who considers Silk Road the antithesis of government.
''Once you’ve seen what’s possible,'' ''Roberts’' writes in one post, referring to Silk Road, ''How can you do otherwise? How can you plug yourself in to the tax eating, life sucking ... oppressive machine again? How can you kneel when you’ve felt the power of your own legs?''
Not everyone on the forums buys the screed. What they do buy, however, is drugs.
''I’m afraid DPR and a lot of this site’s users are on the verge of becoming a cult,'' one user writes, noting that the site itself shouldn’t be a ''shrine to political ideas.''