International Cannabis Business Conference

The End of Ross Ulbricht's Silk Road

Ross Ulbricht was convicted of narcotics trafficking, distribution of narcotics by means of the Internet and several other charges related to the operation of the online drug marketplace, Silk Road.

Less than a week after Ross Ulbricht, convicted founder and mastermind behind the infamous online “dark web” drug bazaar Silk Road, received a prison sentence of life without the possibility of parole, his lawyers filed a notice of appeal. Serious hardcore corruption on the part of two federal investigators working the case should make it a no-brainer, but so far things don’t look good for Ulbricht's chances.

Born on March 24, 1984 in Austin, Texas, Ulbricht was an Eagle Scout who scored a respectable 1460 on his SATs, earning a scholarship to University of Texas at Dallas where he majored in physics, and went on to earn a Masters Degree in Materials Science and Engineering from Penn State in 2009.  

Truth be told, in the beginning Ulbricht, known to users of Silk Road as Dread Pirate Roberts, was an idealist, wanting to create a place where people could buy and sell whatever they wanted without government intrusion and intimidation, as he eloquently stated on his LinkedIn page. After learning about programing, Bitcoins (the digital currency) and marketing, while co-owning and running Good Wagon Books, an online bookstore that eventually failed, Ulbricht took this knowledge, along with his nascent computer coding skills, combined them with a strong Libertarian, anti-authoritarian streak, and created Silk Road. 

While he started out with lofty ideals, Ulbricht ended up allowing the stresses of leading a double life on- and off-line running what became a multimillion dollar illegal goods emporium, to lead him down a much darker path, eventually being accused by prosecutors of approving and paying for the alleged murder of at least one, and perhaps five different people, who he suspected were either stealing hundreds of thousands of dollars from him, blackmailing him or otherwise threatening his safety of and in turn nearly one million registered users of Silk Road. 

Granted, there's no evidence any such murders actually ever took place, and Ulbricht was not facing charges for any of them in the New York trial, even though prosecutors read transcripts of apparent online conversations between Ulbricht and the alleged hit men out loud during the penalty phase of his trial. There is only one supposed victim, Silk Road employee Curtis Clark Green, of an actual murder, and that evidence was entirely faked by disgraced, now former DEA agent Carl Mark Force IV, who's currently in prison waiting his own trial for massive corruption. 

When Silk Road went live in mid-January 2011, it could not be accessed by the casual Internet surfer. The original URL looked like gobbledygook, and you needed Tor, the anonymous Internet browser, installed on your computer to access it. A week later, the Silk Road Wordpress site was created to advertise the hidden Silk Road site, and word began to spread. Gawker ran an article about the site in June 2011, which brought it to the attention of not only thousands more prospective customers and vendors, but authorities too. 

One of the beautiful things about Silk Road was that it had a reputation-based trading system, where buyers were able to comment on the quality of goods and services by each vender selling on the site, similar to how Amazon operates. This cut down on scammers and rip-off artists. There was also a forum where visitors could ask, or give, advice on various drugs, how to use them, how to treat overdoses, and basically offer the epitome of harm-reduction in its purest form. This is something that prohibition makes nearly impossible in any other market. Who has time to chat while dodging militaristic cops in unmarked vans on the street or in the park? Plus, it cuts way down to almost nil any of the turf wars, or other violence that can sometimes occur in today's black market drug world. It was a safe place to shop for, find and discuss, not just drugs but all sorts of underground merchandise and services, a thriving international marketplace full of mainly happy buyers and sellers who were not giving governments and authorities their share in taxes and other payoffs.

Silk Road was a lively marketplace, where anyone could buy just about anything, from an eighth of Jack Herer to a gram of hashish, to a few tabs of high-powered LSD, all the way up to kilos and pounds and anything in between.

The powers that be were having none of it, and highly offended, they went after Ulbricht and Silk Road with everything they had, determined to make an example of Ulbricht. Convicted in February, and sentenced on May 29, Ulbricht was also hit with a $184 million forfeiture ruling in federal court. In addition to the court-ordered forfeiture, the U.S. Marshals Service auctioned off nearly 30,000 Bitcoins to private investors, just part of Silk Road's massive digital cache, netting around $19 million. There's also the fact that a now former Secret Service Agent, Sean Bridges, is accused of stealing at least $800,000 in Bitcoins and placing them in his personal account on the Mr. Gox Bitcoin exchange during his role in the investigations, while former DEA agent Force coerced hundreds of thousands of dollars in a variety of scams and outright theft from Ulbricht during his investigations. 

Judge Katherine Forrest, who presided over Ulbricht's trial, ruled in April that Ulbricht did not warrant a new trial because the evidence against him was conclusive, so the corruption by federal investigators made no difference. This is especially troubling, considering the many other instances of wrongdoing by police and the Feds in other, unrelated investigations have caused scores of cases to be tossed out, even when the accused had admitted or were about to admit their guilt, as is the ongoing case in California with former FBI agent Scott Bowman.

During Ulbricht's trial, his lawyer argued that, while admitting he'd designed and launched the Silk Road site originally, he was the fall guy, that Ulbricht had passed on control of Silk Road to an unnamed mystery person soon after he'd gotten the site off the ground, a person who'd then pulled Ulbricht back in just in time to take the blame when the Feds moved in to shut things down. Ulbricht's journal documenting his experience getting Silk Road up and running, as well as his laptop contained all the evidence they needed to tie him to the inner workings of the site. The jury took just three and a half hours to convict Ulbricht on all seven charges in a Brooklyn, New York federal court, charges that consisted of: narcotics trafficking; distribution of narcotics by means of the Internet; narcotics trafficking conspiracy; continuing criminal enterprise; conspiracy to aid and abet computer hacking; conspiracy to traffic in fraudulent identity documents; and money laundering conspiracy.

Professor Nicolas Christin, a Carnegie Mellon University researcher, conducted a study of sales trends on Silk Road, analyzing the site daily from February 2012 to July 2012. They used a website crawling system to look at the sales of 24,000 separate items to create a comprehensive picture of what sorts of goods were sold and the revenues accrued by the sellers. 

During the study, Nicolas and his team found that marijuana was the highest selling drug, amounting to 13.7% of sales, followed by uncategorized “drugs” (9%), “prescription” (7.3%), cocaine (2.6%), MDMA (1.6%) and heroin (1.5%). While Silk Road was known mainly for its drug offerings, with 16 of the top 20 categories focused on drugs, there were also categories for books, digital goods and services, pirated content, hacking services, and erotica. Silk Road was a lively marketplace, where anyone could buy just about anything, from an eighth of Jack Herer to a gram of hashish, to a few tabs of high-powered LSD, all the way up to kilos and pounds and anything in between. Buyers could spend as little as $20, or the equivalent in Bitcoins, or thousands of dollars for large amounts. 

For anyone wanting to see the detailed minutia and background goings-on at Silk Road, check out a fascinating archive of conspiracy theories, forum postings, scams and scammers, law enforcement efforts, and more here

There are sites of similar nature still active, such as Agora Marketplace, so while the Feds are trying to make an example of Ulbricht in hopes of scaring away potential imitators and buyers alike, they seem to be failing miserably. For those people out there who despise prohibition and want the whole War on Some Drugs to be over, this is nothing but a good thing. 

Preston Peet

Preston Peet

Editor of "Under the Influence, the Disinformation Guide to Drugs," former editor of DrugWar.com, and writer of numerous articles around the globe.