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The Silk Road has been busted – but its legacy to the international drug trade will remain

3 October 2013

12:05 PM

3 October 2013

12:05 PM

Since 2011, the Silk Road has infuriated governments the world over by allowing digital pirates to operate above the law. It has been – in effect – an eBay for Afghani heroin, cocaine and all manner of illegal goods. Hosted in the virtual tunnels of the ‘Deep Web’, transactions are made in BitCoin and up until yesterday, it was doing roughly 60,000 a day. But now, it seems, the cops have swooped. Yesterday afternoon Ross William Ulbricht, known by the pseudonym ‘Dread Pirate Roberts’ was arrested – on charge of being the owner.

Drugs were the site’s bread and butter, making up 70 percent of sales. But you could buy all manner of items including art, erotica and jewellery; banned copies of 18th century literature occasionally circulated. There were limits though: terms of service prohibited the sale of anything whose purpose was to ‘harm or defraud’ – amongst the list of items banned were child pornography, assassinations and weapons of mass destruction.

But it was the trade in drugs that fuelled the site’s success: between February 2011 and July 2013, there were approximately 1,229,465 transactions completed – the value of these estimated to be around $1.2 billion.


For people using the site, it offered a familiar interface: that of the world of online shopping. The recognisable components of e-commerce were all there: the shopping basket, the checkout, user reviews, product alerts, seasonal sales, global delivery options. Sellers shipped the drugs using regular couriers or postal services. As a market, it functioned smoothly, because the consumer drove it, and the retailer responded. One bad review and your business could be ruined. It relied on the retailer ensuring the quality of their product was high, their customer service was excellent, and their prices competitive.

The Silk Road also cut out many of the famously nasty middlemen. Rather than having to meet some jumpy dealer at the end of your street, you could have your order sent directly to an address – and it would promptly arrive, enclosed in discrete, bureaucratic-looking packaging. Enterprising chemists around the world were now able to synthesize recreational drugs, and sell them direct to the consumer.

Of course, the Silk Road could never cut out all the unpleasant elements of the international drug trade, but it certainly cut out some of them – and the Royal Mail seemed like a much more wholesome (and unwitting) drugs mule.

So what now? Where will the thousands of e-businesses, turning over impressive profits, set up shop? Initially, they will probably lay low, until the media buzz dies down. But with business that strong, demand that high, and profits so gleaming, it won’t be long before another alternative website springs up. In fact, it may already be up and running.

Most opposition to drugs isn’t driven by the belief that they are all intrinsically harmful – after all, alcohol kills far more people in the UK annually – around 40,000. Compare that to heroin (around 700), cocaine (around 200) and ecstasy (around 30). Instead, opposition is mainly provoked by the belief that the illegal trade routes cause so much harm. What the Silk Road offered was a way of circumnavigating much of this. It may seem like just a clandestine Amazon, but its implications are major: it has altered the world of virtual currency, e-commerce and, most importantly, the international drug trade. In the darkest corners of the Internet, business will continue to boom.

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Show comments
  • Blazenka Hudson-trograncic

    This story shows how the ‘strong state’ will fight with all its agents,FBI, NSA,DIA etc. to stop the trend which could lead them to losing control of their subjects.
    It shows that TOR,bitcoin etc. are under attack, this is what cyberwarfare is all about.

    • ButcombeMan

      Tor is supported by the State Department surely?

  • Tom Tom

    The FBI spends a lot of time monitoring IT websites like Stack Overflow apparently. That is unfortunate when even programmers discussing code are subject to surveillance, it means even those sites will start to go dark. The Total Surveillance Society will lead to a competitive race to the dark regions and most ordinary people will be back to the AOL Garden of restricted Internet activity controlled like broadcast media by the corporations

  • Duncan McNab

    The traffickers will resume their traditional routes – just pop it into a shipping container and off you go..chances of being caught close to zero. Or the Australian innovation – fly cocaine from Mexico in a private jet – customs are seldom nosey, and then back load the cash from the last shipment…all too easy!

  • James Strong

    Most opposition to drugs is, in fact, from interfering, moralistic, authoritarian busybodies.
    The illegal trade routes only cause harm because they’re illegal.
    Fully legalise drugs and most of the problems associated with their use disappear.
    Yes, there will always be some people who abuse them so much that they wreck their lives. That’s the same with alcohol. People like that are always around; that is not a sufficient reason for me, or you, not to have access to alcohol and drugs.

    • Daniel Maris

      I agree with legalisation, but the state will need to move into supervise production I think and price the illegal operators out of the market. The state can produce a range of drugs satisfying demand. It can include health warnings with the merchandise and supervise age limits. It would need to make use of informal street dealers as well as pharmacists. The street dealers would become the best policemen of the new arrangements – just as licensed taxi drivers are the best at policing illegal taxi trade.

      • ButcombeMan

        If you think about, just for a moment, “the state” cannot price drug dealers out of existence unless it gives drugs away.

        From what I can see there a lot of price elasticity.

        And this statement fom the article is garbage:

        “Most opposition to drugs isn’t driven by the belief that they are all intrinsically harmful”.

        Most sensible people would accept that tobacco, a drug more of us are familiar with, IS intrinsically harmful. So, potentially, is alcohol, in any more than modest quantities. The ilegal drugs are no differrent, each seems to have its own particular harms.

        Measuring the harm of a drug by the number it kills is not very smart either. The harm of drugs is not just through death, try living with an alcoholic or have one as a mother. Or watch someone linger on for years with emphysema .

        Apart from that point, prevalence must also affect the number harmed by a drug.

        It seems to me that alcohol & tobacco cause more harm (and even death) because their use is more prevalent.

  • Mark_ld

    Long live Bitcoin.
    Bitcoin has many benefits…one of them is that it stops the Governments from stealing your savings by stealth devaluation via inflation. This is the future of one type of value.

    • The Laughing Cavalier

      Instead it steal your money through wild fluctuations in value.