• February 1, 2023

Silk Road was founded 10 years ago, The first Dark Web market that accept Bitcoin

Key facts:

  • Silk Road closed in October 2013 after being intervened by the FBI.
  • Ross Ulbricht, the founder of the market, is sentenced to two life sentences.
  • It’s been roughly ten years since January 2011, when Silk Road was set up, a site that has already closed and served as a market for illegal goods, accepting bitcoin (BTC) as a payment method.

With Ross Ulbricht, founder of the Silk Road dark web market, serving two life sentences in prison, the court case hasn’t been fully solved yet. Among other unknowns, it’s pending to recover 400,000 missing BTC and possibly they’re in a computer that wasn’t managed to grab at the moment. Sometimes, the situation returns to the headlines of technical media in addition to discussion in the community.

Beyond the controversy surrounding the case and aspects that, for lots of people, are reprehensible, like the trafficking of illegal substances, Silk Road was the primary market to accept Bitcoin as a payment and dictated the cost of this cryptocurrency over a time period.

How did Bitcoin get incorporated into the dark web and Silk Road?

Without precedent for what Ross Ulbricht was aiming for — creating an open and free marketplace with all types of posts – the site’s successful launch depended upon the mix of Bitcoin and the Tor (.onion) internet browsing protocol.

Even though the dark web (darknet) is intended to facilitate anonymity throughout its exploration, there’s absolutely no default configuration that guarantees it. In actuality, authorities like the FBI, DEA, and other police agencies worldwide are regular visitors to this prohibited area of ​​the web and frequently monitor user traffic that happens there.

However, the dark web can also be the favored use of hackers and cyber-criminals. They could operate and find all types of things, from goods and services (legal or illegal) to sensitive, filtered, or classified information. To access the dark web domain names, users need to use the Tor browser, amongst others, which eases the anonymity of the consumer. But within the dark web, with its advantages in favor of anonymity, Silk Road didn’t have the necessary tools to operate properly because payment methods like PayPal, Payoneer, and credit or debit cards aren’t anonymous in any way.

In February 2011, when Silk Road was three weeks old, an account supposedly controlled by Ulbricht, posted on the BitcoinTalk forum a post about the portal’s performance.

From the start, the mixture of bitcoin for payments, and Tor for anonymous surfing, was a successful formula for Silk Road, which was starting to draw attention online.

Silk Road boosted the Bitcoin market in its first years

People who wanted to purchase on the website could register for free; however, when a user wanted to register as a vendor, they needed to purchase the account with BTC via an auction mechanism. Additionally, for every purchase of things on the website, Silk Road charged a commission in BTC.

This is the way interest in purchasing the cryptocurrency increased among Silk Road users, which definitely influenced the little Bitcoin market.

In this manner, a mysterious webpage on the dark web helped legitimize Bitcoin as a legitimate electronic exchange and helped it grow as a marketplace.

Ross Ulbricht successfully implemented Bitcoin in a market for illicit products on the dark web. Source: freeross.org

At one stage, when an article by the American website Gawker went viral online portal, bitcoin reached a cost of $ 5 for the first time in its history. It should also be mentioned that the identical article caused the opening of an investigation by the FBI and the DEA, which finally caused the site’s closure in 2013, along with the seizure of hundreds of thousands of BTC circulating on the Silk Road.

Bitcoin frees itself from the poor reputation attributed to it by some

Since that time, the antecedent of having been related in its infancy with an internet portal such as Silk Road weighs bitcoin. This argument is often used by critics of cryptocurrencies, who point to Bitcoin as a tool to facilitate illegal activities.

Although it’s no secret that bitcoin may be used by criminals to finance their illegal activities, like any other financial technology, cryptocurrency is positioned as a method of safeguarding and payment of value from the legitimate spheres of society.

In this manner, the story that points to bitcoin as an intrinsic part of criminal conspiracies expires. By way of instance, according to a report by SWIFT, an interbank transfer platform, bitcoin isn’t widely used as a method for money laundering and financing of illegal activities.

Although until a couple of months past its predominance was evident, bitcoin’s energy on the dark internet is no longer the same. Because bitcoin isn’t an anonymous system nor does it get in the method of monitoring your customers and transactions, Monero (XMR) has become the darling of the darkened web.

Monero, a cryptocurrency centered on anonymity and privacy, has been used with increasing frequency in the dark web markets. In 10 years, the taste of cybercriminals, hackers, and illegal marketplaces on the internet shifted from Bitcoin to Monero for apparent explanations.

Lately, with the close of DarkMarket, (motivated by Silk Road), WhiteHouse has been the principal market for the dark web. WhiteHouse doesn’t accept Bitcoin, focusing solely on Monero, we reported on CryptoNews. This is the first time that such a huge market hasn’t accepted Bitcoin as a way of payment.

Bitcoin is decentralized and cash money

While bitcoin is at a clear disadvantage concerning anonymity compared to Monero and Zcash, Silk Road represents a successful use case for Satoshi Nakamoto’s production. This cryptocurrency’s success in permitting payments and trades in a free and open market (however illegitimate it might be contemplated) is based on its resistance to censorship and its neutrality.

How a market with such varied products, with users unfamiliar to one another, in a dark environment where disputes aren’t valid, and there isn’t any reliable arbitrator to mediate interactions, bitcoin triumphs as hard money.

Bitcoin went from being the money of illegal markets into one of the most booming stores of this moment’s value. Source: Roy Buri / pixabay.com

In 2011, when Silk Road premiered, Bitcoin was two years since Hal Finney first conducted the protocol applications, and Satoshi Nakamoto, its founder, still had a couple of weeks to go before it vanished from public view. Even though a halo of uncertainty surrounded the Bitcoin ‘experimentation’, it had been successful after passing the terrific test the Silk Road represented.

Since Bitcoin makes its way to global markets, the Silk Road case still remains open. Last year, it was disclosed that 69,370 BTC stolen from the website by a hacker passed into the USA’s national authorities’ hands, who will need to deliberate the use which will be given to them.

The funds obtained from the sale of those BTC might be used to enhance surveillance over cryptocurrency networks, CriptoNoticias reported. This demonstrates that Bitcoin can be tracked to a geographical location and identity, in addition to evidence that surveillance will continue to grow and improve thanks to the efforts of authorities with the aid of specialized private companies.

Recently, it became understood that Donald Trump didn’t grant a presidential pardon to Ulbricht, that relatives and activists have insistently asked, considering that an excessive penalty was levied. The guy in charge of Silk Road is 36 years old and may devote the rest of his life in prison unless his sentence is commuted or pardoned before it’s too late.

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