Stealthy Silk Road website flying high

Sally Herships Aug 28, 2012

Stealthy Silk Road website flying high

Sally Herships Aug 28, 2012

Kai Ryssdal: If somebody mentions the Silk Road to you, what do you think? Marco Polo and the exploration of Central Asia, right?

Yeah, that’s the mistake I made. The modern Silk Road is apparently an online marketplace for illegal drugs: cocaine, ecstasy, heroin — the serious stuff. And a seriously profitable one, too. A new study from Carnegie Mellon University says the Silk Road is bringing in an estimated $2 million a month, and growing. But if it’s so easy to buy illegal drugs online, why isn’t it easy to shut it down?

Sally Herships has that story.

Sally Herships: Do you remember The Dread Pirate Roberts from the movie “The Princess Bride”? The Dread Pirate is also the name, the customer service rep on Silk Road goes by. It makes sense that he, OR SHE, wants to stay anonymous. But while the site may be illegal, it is still a business.

Nicolas Christin is the author of the new study on Silk Road.

Nicolas Christin: It’s somewhat surprising how normal the whole thing is if you set aside the type of goods that are being sold.

Silk Road’s biggest seller is marijuana. But you can buy gift certificates on the site. Sellers get reviews — like “the product was great!”, “Prompt shipping!” Christin says shopping on Silk Road works pretty much the same as it does on eBay or Amazon.

Christin: You see something that you like you browse through different categories you click, add to cart.

But even though buyers do have goods shipped to them through the mail, they don’t use Paypal or credit cards. Instead money changes hands in the form of Bitcoins. It’s a digital currency that’s really hard to trace. The site also uses a software called TOR.

Andrew Lewman: People use Tor because they want to separate who they are from where they’re going on the Internet.

Andrew Lewman is director of the Tor project., a nonprofit that researches and develops online privacy. He says activists blog revolutions in dangerous countries using Tor.

Lewman: Maybe you’re a teenage girl and you want to investigate women’s rights. And in certain countries, that is a threatening action.

Tor’s job is to make all its users anonymous. It’s one of the reasons Silk Road is so difficult to track. The DEA said it had no comment on the site. And all this secrecy means shopping on Silk Road comes with risk. If shoppers have a problem with a transaction — they can’t call the Better Business Bureau. But Nicolas Christin’s study says business at the site is growing quickly.

Chris Dellarocas: You have to understand that this is not about ethics. It’s just about common sense.  

Chris Dellarocas is chair of information systems at Boston University.

Dellarocas: The fact that somebody is dealing in contraband doesn’t mean that they’re necessarily “dishonest” when it comes to fulfilling transactions. If somebody wants to remain in the market and sell to other people in the future, they have to deliver what they promise.

And, Nicholas Christin says, for consumers who shop at hidden sites like Silk Road, buying online can be safer than dealing with a seller in person. Another reason business on the site is booming.

In New York, I’m Sally Herships for Marketplace.

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