The Silk Road: Crypto’s Infamous Marketplace

Silk Road is an online black market that existed on the darknet and was shut down by the FBI.

What is Silk Road?

Silk Road was an online black market that existed on the darknet that has now been shut down by the FBI. It accepted bitcoin for transactions. When Bitcoin was created, the key characteristic that BTC tried to guarantee was anonymity. In general, cryptocurrencies are anonymous. But this only applies when no trace is left behind after the transaction. For example, buying a cryptocurrency with a credit card can lead to a trail. Similarly, buying a cryptocurrency on an exchange can leave a trace confirming the delivery address.

Silk Road was created by Ross Ulbricht. The site, created in 2011, served as a marketplace where customers could order a wide range of illicit goods, including fake IDs and drugs. Often marketplace customers could pay with cryptocurrencies.

The market is often referred to as the cutting edge of the illegal drug business. Silk Road is believed to have earned about $1.2 billion in two years. It is also believed to have made about $80 million in commissions.

In October 2013, when Silk Road was shut down by the FBI, 174,000 BTC were seized. But at least 444,000 BTC are believed to be completely missing. It is suspected that Ulbricht was using another computer that may have stored data on the missing BTCs and lost coins.