October 2021

Into the deep: the clandestine world of the dark web marketplace

Three years ago, Bradley (not his real name) was talking with his friends about how to make quick money investing in Bitcoin.

Somewhere in that conversation, someone said they’d heard that the cryptocurrency could be used to buy pills on the internet. The idea piqued Bradley’s curiosity.

That weekend, he managed to log on and place an order with a Dutch supplier. Three days later, the package arrived by express post to his front door.

“We were young and dumb, but we tried the pills and they were legit,” Bradley says. “We thought to ourselves, ‘It can’t be this easy to break the law. You can’t just buy a scheduled drug online and have it shipped to your house.’

We thought to ourselves, “It can’t be this easy to break the law. You can’t just buy a scheduled drug online and have it shipped to your house.

Bradley

“So we bought some more for the next weekend, and we bought some more after that. Then my other friend said ‘I have a friend who wants you to get them pills’. That was it.”

Thanks to a mix of know-how and access, Bradley had plugged himself into a global distribution network that set him on a path to becoming the biggest small-time dealer in his region over a matter of months.

Beneath the surface

If the regular internet can be thought of as being like a phonebook where every website is listed and easily searchable through a portal (like Google), the deep web refers to those websites that are unlisted, more difficult to find and largely anonymous.

The dark web refers to a small part of the deep web. Getting there is tricky: it requires a stable internet connection, a working computer or phone and time to learn how to use the right software correctly to ensure anonymity.

The process relies on the Tor network: a special suite of software that provides layers of encryption to mask the identity of users.

Total anonymity, however, hasn’t always been guaranteed. Originally, anyone attempting to make a commercial transaction on the dark web could still be identified as financial transactions were usually handled through third-party services like Western Union or Mastercard.

Ross Ulbricht, a tech entrepreneur living in Austin, Texas, attempted to solve this problem when he founded The Silk Road in February 2011 under the pseudonym ‘Dread Pirate Roberts’.

His solution married anonymous cryptocurrencies like Bitcoin to an internet marketplace with the functionality of eBay, Amazon and Etsy so people could buy and sell anonymously.

Dr James Martin, a criminologist at Deakin University whose landmark book on The Silk Road was cited in Ulbricht’s eventual criminal trial, says it was a revelation for anyone seriously involved in the drug trade.

“If you’re someone who wants to sell illicit drugs, one of your immediate problems is supply, so how do you get the drugs to be sold?” James says.

If you’re someone who wants to sell illicit drugs, one of your immediate problems is supply, so how do you get the drugs to be sold?

Dr James Martin

“If you look at the kinds of problems the dark web solves, one can be a supply problem, so it enables you to buy the drugs and re-sell them. Of all the jobs you can have in a drug distribution chain, working at the retail end is the most risky.

“[With Silk Road] you’ve got Tor, you’ve got your geographical distance, you’ve got cryptocurrency, all working to protect your identity.”

While the idea of an “eBay for drugs” has been sensationalised in some media stories over fears that drug use has moved online, dark web cryptomarkets still represent a small, albeit growing, proportion of overall trade.

The latest World Drug Report found that between 2017 and 2020, darknet sales amounted to, on average, US$350 million ($470 million) per year, of which about 90 per cent were drug-related. That’s just 0.2 per cent of the combined estimated illicit annual retail drug sales in the United States and the European Union over that time.

An appealing option

In creating The Silk Road, Ulbricht explicitly banned the sale of any product or service that might involve direct physical harm to a person.

What made it attractive, however, was the mechanisms it built to allow users to leave product reviews and participate in anonymous internet forums and the introduction of methods for resolving contractual disputes.

Though the site allowed the sale of items ranging from fake credit cards to weaponry, for many its main draw was the universe of psychoactive substances sold with slick, modern marketing techniques.

Although gaining access to cryptomarkets such as The Silk Road is not easy for everyone, those who made the effort ended up in this case in a community of loyal users who shared insight, information and experience.

In one example, The Silk Road’s forum included a ‘harm reduction’ sub-forum which became home to a medical advice thread for users who wanted answers to questions they couldn’t ask their GPs.

Over the life of the site, Dr Fernando Caudevilla, a Spanish doctor posting as ‘DoctorX’, answered 750 questions about topics such as dosage, drug interactions with other medication, side-effects and toxicity.

At the same time as the community swapped information, the economic dynamic of the marketplace meant the service provided by vendors quickly stratified.

Just like in all other markets, not everyone wins on the dark web.

“The market is dominated by a few top-tier players and you have this second tier that is developing, then you’ve got the third tier, which is the bulk of other users,” Dr Martin says. “These are people who have tried and failed, or people who dipped their toes in.

“And then not everyone can participate. There are also barriers to entry for some people, but then those people may be buying from someone who does use the dark web to source the heroin they’re using.”

Out of business

The Silk Road was shut down in October 2013 when an FBI raid forced the site offline and exposed Ulbricht’s identity.

While the arrest came as a shock to the site’s users, several other successor markets subsequently rose to take its place as the community migrated elsewhere.

Along the way they took with them the practices they’d developed. The harm reduction forum moved to Dread – a dark web analogue to Reddit – where users have recently been crowdsourcing product testing.

Criminologist Rasmus Munksgaard, Assistant Professor at Aalborg University in Denmark, says there has been a divergence among these successor operations when it comes to managing trust.

“There’s a weird, East-West split,” Rasmus says. “In the West, there’s been very little innovation in this space. Most of these markets pretty much follow the same plan Silk Road laid out where it’s like eBay.”

Munksgaard says that while markets in the West have relied on well-established systems for reputation tracking across marketplaces and user reviews, Russian-language markets have been taking on the risk themselves.

In some cases, cryptomarket operators offer vendors a paid verification service where a chemist is dispatched to test drugs for purity and quality.

Others have entirely removed the need to rely on a postal service by organising alternative logistical systems. This method involves geocaching – a form of dead-drop where a buyer is sent GPS co-ordinates and a photo of a hiding spot so they can collect the product themselves.

A means of connecting

Dr Monica Barratt, a social scientist with Australia’s National Drug and Alcohol Research Centre, says that when it comes to harm reduction, it’s not clear if cryptomarkets have helped.

“These online forums allow people to talk to others,” Monica says. “If someone doesn’t have anyone around to use drugs with, they’re doing it in a solitary environment. That may be harmful or have the potential to cause harm as they don’t have someone to call.

These online forums allow people to talk to others. If someone doesn’t have anyone around to use drugs with, they’re doing it in a solitary environment.

Dr Monica Barratt

“The other side, the more nuanced side, is what if a person accesses something they normally wouldn’t have access to and becomes dependent on it? What do we say about that?”

These were the questions Bradley grappled with himself.

In the six months in which he went from supplying a small group of friends for personal use to running his operation full-time, he says he always operated with a degree of responsibility – and even pride.

“There were a lot of other people around who sold drugs, but they kind of half-arsed everything. I thought if I put a bit more effort into things, I could do it different and better,” he says. “My first thought was, ‘I’m never going to sell ice or meth or go near that shit.’ I didn’t want to hurt anyone.”

While some vendors refused to sell to Australia owing to the risk of interception at the border, Bradley found that as the local connection to a global supply chain he could take an order and source whatever his client wanted.

Before long he began looking for ways to improve his customer service. He bought for quality, educated himself on what he was buying, ran deliveries and supplied reagent kits with every order so people could check for themselves.

But even then, there was only so much he could do.

“I was spending a lot of time researching what I was buying so I could tell people what they were buying – but I found no one cared,” he says. “It was really disheartening because I cared about the detail.

“The chain is only as strong as its weakest link. The dude on the street who buys doesn’t care, but the distributor cares. I guess that’s what matters in the end.”

– Royce Kurmelovs

Surfing the dark web

The National Drug and Alcohol Research Centre (NDARC) issues regular updates about the types and availability of drugs sold in online cryptomarkets.

Its latest report shows that there was an average of 70,332 drug listings per week across the monitored cryptomarkets in May 2021, representing a 7 per cent decrease in listings as compared to May 2020.

The greatest market share of drugs listed on the monitored cryptomarkets from May 2020 to May 2021 was held by cannabis (29 per cent), followed by MDMA (12 per cent), cocaine (9 per cent), benzodiazepines (8 per cent), and illicit meth/amphetamine and LSD (both 6 per cent).