The Silk Road was probably the largest network of trade routes in ancient times. But from the 2010s onwards, talking about "Silk Road" would start to be linked to something darker: it would be the name of one of the pioneering and most critical black markets in the history of the Internet.

This market called Silk Road was directly linked to cryptocurrencies, specifically Bitcoin, an asset that we have previously talked about emphasizing its operation, benefits, and news about its application.

Today it is time to review the dark shades of this technology and address a link that, for sure, was vital on the way to the rise of Bitcoin (BTC).

What was Silk Road?

Silk Road was an Amazon-style store that operated on the Dark Web from 2011 until 2013 when the FBI shut it down after a lengthy operation. It operated as a black market, where illegal goods and services could be traded.

The term Dark Web or Darknet is used to specify the characteristics of the space where the page operated, since it is part of the Deep Web.

The latter refers to all those internet sites not listed in search engines such as Google and are therefore not public (e.g. your WhatsApp conversations). To access the Deep Web, you need an appropriate browser (Tor being the most known), and the addresses are typically given the ".onion" extension.

The Dark Web would be an even deeper level, where anonymity is possible (to some extent) and is usually associated with... "less-than-innocent" activities (sort of like Harry Potter's Knockturn Alley). This is where Silk Road operated.

This site was created by American programmer Ross Ulbricht. An entire article could be written about his case, being of interest the philosophical foundations behind the creation of the site, due to the fact that it was conceived, in Ross' own words, as a means to be able to carry out commercial transactions without state intervention, Ross' thinking being strongly marked by "liberal and anarchist" ideas (Adler, 2018; Ghimiray, 2022).

The site's top product was drugs of all kinds, from LSD to marijuana and everything in between. Also, weapons, poisons, malware, restricted consumables, and criminal services such as hacking and hitmen were offered. This does not mean that only these products could be marketed, as anything, licit or illicit, could be offered for sale.

In October 2013, Ross Ulbricht was arrested by the FBI and the site was shut down. Although most of the bitcoins circulating on the site were confiscated, a good portion remains unrecovered to this day.

Despite being one of the first and probably the most important, Silk Road is but one of many sites of its kind, and there have been many black markets, some of which are still in operation today. The truth is that Silk Road was an inspiration to many, and its legacy lives on.

Silkroad and Bitcoin: the dark link

When the site was created, there was a problem: the need for a non-regulated method of payment that allowed for anonymity. It required an e-cash with which to make transactions... and Bitcoin fit perfectly into the puzzle.

If we look up images of what the Silk Road interface looked like, we can see that the price of products was expressed in Bitcoin: it had become a sort of "official currency" for the site.

Source: ResearchGate. This screenshot shows the interface of Silk Road, with some of the available products and the index of categories. The price of the products is very interesting, since they reflect the value of the Bitcoin (BTC) at that time, well below its current value, since, at the time of this writing, one Bitcoin is equivalent to more than 16,660 USD.

Due to the limited personal information required for the use of cryptocurrencies, Bitcoin allowed, in conjunction with other tools, the site users' identities to remain "protected", something that was not possible with other platforms such as PayPal.

Silk Road's payment system worked as follows: the consumer converted his cash into BTC, which he transferred to a Silk Road account and, when buying a product, the site charged a commission in this same currency. The seller received the payment in his account and, through an exchange, converted it into cash. In this way, the site's moderators were able to accumulate considerable fortunes.

This symbiotic relationship allowed Silk Road to operate and thrive among users, while, as Esparragoza (2021) mentions, it legitimized the cryptocurrency as a means of payment, increasing its popularity and value.

"Freedom" or "security"?

Despite the fact that, in many cases, regulations, control, and institutional intervention become mechanisms against users and consumers, the truth is that, at least in our current reality, they are necessary and our societies cannot function without them.

The emergence of tools that seek, supposedly, to give us the freedom to surf the Internet and give us back the privacy we have lost on it, is something positive not only for ordinary users, but also for those who operate on the "dark side" of the web, and can use them to perform illegal or directly criminal acts, harming others.

Since these tools can be used to do harm, there needs to be some regulation at the expense of the almost absolute "freedom" they seek to grant, for the sake of our safety.

We mentioned earlier that the case of Ross Ulbricht could be addressed in a separate article. This is because there is currently a wide debate about his conviction. The FreeRoss.org site claims that the sentence imposed on Ross is disproportionate to his charges, especially considering that, as Ross himself has always stated, the intention behind the creation of the site was humanistic, being his thinking based on economic liberalism.

Source: Free Ross Ulbricht. Currently, Ross has served 10 years of two life sentences at the Metropolitan Correctional Center in New York. He is 38 years old.

Although there are some reasonable arguments in defense of Ross, the responsibility he had for the damages caused by the tool he created must also be considered in this discussion.

The debate is on: Is Ross Ulbricht's conviction really fair? To what extent is the axe forger responsible for the execution? Is his ideal of an unregulated market something possible, or even something we should pursue?

"Silk Road was supposed to be about giving people the freedom to make their own choices, to pursue their own happiness, however they individually saw fit." (Ulbricht, 2015)