Silk Road was a virtual black market operated as a hidden service on the Tor network. In particular, illegal drugs and various digital goods were traded there, with the cryptocurrency Bitcoin being used as the only means of payment. After the original platform was seized after two and a half years of activity and the alleged operator was arrested, it reopened just a month later under Silk Road 2.0. By cracking the anonymization network “Tor” as part of Operation Onymous and an agent who had been infiltrated before that time, a new seizure was made a year later in November 2014.
Ultimately, the demise of the original Silk Road led to a veritable boom in darknet markets, which soon gave rise to the alternatives Agora and Evolution (shut down since March 2015) overtook Silk Road as the largest and best-known market.
The design and user interface were professionally executed and similar to those of other virtual marketplaces such as eBay or Amazon. Silk Road provided each account with a wallet with multiple Bitcoin addresses. Upon completion of a purchase, the corresponding sum was transferred directly to the merchant; manual finalization by the buyer was no longer necessary and the escrow system had also been deactivated due to security concerns.
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Feedback on purchased products could be left in the form of a review and rating. In the event of problems with processing, ticket-based support was available, which primarily dealt with the investigation of fraud cases. There was also an official community forum.
Also read How Darknet Market Works
Image credit : Business Insider
Security Mechanisms
Since Silk Road was a permanent target of law enforcement, all participants were expected to adhere to certain rules regarding anonymity. For example, all communication, in particular the transmission of delivery addresses, had to be carried out using strong PGP encryption. In addition, in view of the widespread identity theft on the darknet, it was strongly recommended to activate two-factor authentication, whereby a short puzzle must be decrypted after entering the login name and password using one’s own private PGP key.
For secure and anonymous access to the platform, the Tor Browser Bundle and a current PGP implementation (such as gpg4usb) were recommended as a minimum measure in the official forum. Ideally, the programs, both of which do not require installation, are copied together with the private keys and other sensitive data to a removable storage device (e.g. encrypted with VeraCrypt or dm-crypt). Windows users are also advised to use a specialized Linux live system such as Tails, as the combination of Windows 8 and TPM 2.0 hardware in particular no longer offers any security against arbitrary third-party interference.
Currently, bitcoins are not completely anonymous, but merely “pseudonymous”; The metadata may be used to trace transactions back to a specific Bitcoin address. In order to eliminate this risk, there are so-called mixing services or tumblers, in which the origin is disguised by means of random payouts from a shared pool.
