
Operator of Silk Road 2.0 Website Charged in Manhattan Federal Court - pc
http://www.fbi.gov/newyork/press-releases/2014/operator-of-silk-road-2.0-website-charged-in-manhattan-federal-court
======
jim_dnaley
They located Silk Road 2.0's server in an unspecified way, not directly
related to their undercover agent on the support staff. Given that two other
darknet markets (Black Market and Cloud9) have been shut down today, and they
didn't specify how they located the SR2 server, it seems plausible that law
enforcement have a vulnerability to locate servers over the Tor network.

From the complaint:

"In or about May 2014, the FBI identified a server located in a foreign
country that was believed to be hosting the Silk Road 2.0 website at the time.
On or about May 30, 2014, law enforcement personnel from that country imaged
the Silk Road 2.0 Server and conducted a forensic analysis of it. Based on
posts made to the SR2 Forum, complaining of service outages at the time the
imaging was conducted, I know that once the Silk Road 2.0 server was taken
offline for imaging, the Silk Road 2.0 websites went offline as well, thus
confirming that the server was used to host the Silk Road 2.0 website."[1]

Then, as a result of extremely poor OpSec (Benthall accessed the server
directly, used his real email for registering the server), they got his IP's
and, well, you know where it goes from there.

1\. [https://pdf.yt/d/RpyX9_xmapTkhmkb](https://pdf.yt/d/RpyX9_xmapTkhmkb)
(Complaint)

~~~
882542F3884314B
Interesting read, some highlights from the complaint:

"40\. Based on a review of records provided by the service provider for the
Silk Road 2.0 Server (the “Provider”), I have discovered that the server was
controlled and maintained during the relevant time by an individual using the
email account “blake@benthall.net” (“Benthall Email Account-1")."

"b. I have also reviewed a publicly available profile of “Blake Benthall” on
Twitter, another social networking website, which includes a photograph of
BENTHALL as the user of the account, depicting the same individual associated
with the GitHub account, discussed above. I have reviewed a post on that
Twitter profile, dated on or about November 6, 2013, the date when Silk Road
2.0 was publicly launched, stating: “All this talk about the #SilkRoad being
back up makes me want to watch ThePrincessBride.”"

"a. I have reviewed records provided by a U S.-based Bitcoin exchanger
(“Exchanger-1"), for an account registered under the name “Blake Benthall” and
linked to Benthall Email Account-1 (“Bitcoin Account-1”). According to
transaction records for Bitcoin Account-1, BENTHALL engaged in his first
Bitcoin transaction with Exchanger-1 on or about November 7, 2013, the day
after Silk Road 2.0 was publicly launched. The transactional records reflect
that, since that date, BENTHALL has received a total of approximately 575.58
Bitcoins into the account through on or about October 28, 2014, and that
BENTHALL has exchanged approximately 543.63 of those Bitcoins for United
States currency, totaling $273,626.60"

"c. I have reviewed emails from Benthall Email Account-1 reflecting that
BENTHALL purchased a luxury vehicle with Bitcoins in late January 2014 -
approximately one month after Defcon assumed control of Silk Road 2.0.
Specifically, email correspondence indicates that, in or about late January
2014, BENTHALL made a down payment of approximately $70,000 in Bitcoins
towards the purchase of a Tesla Model S, worth approximately $127,000 in
United States currency."

"b. Records provided by Exchanger-1 regarding Bitcoin Account-1 indicate that
on the same date, BENTHALL logged into Bitcoin Account-1, using the identical
combination of software: Google Chrome web browser version 35.0-1910.3 and the
Apple OS X operating system, version 10.9.0.

"c. According to publicly available information, on or about April 6, 2014,
Google Chrome version 35 O.1910.3 was a beta version of the browser,L2 and
Apple OS X version 10.9.0 was outdated.B Thus, based on my training and
experience, this particular combination of software versions would not have
been common among Internet users at the time. The information available to the
HSI-UC indicates that Defcon was not using Tor to access the customer support
interface at the time, which would have caused Defcon’s browser and operating
system to appear differently."

~~~
bluedino
>> made a down payment of approximately $70,000 in Bitcoins towards the
purchase of a Tesla Model S

Way to lay low.

~~~
tptacek
This is a lot of major crimes investigations: if you want to participate in an
organized criminal effort (which is what SR2.0 is), you're only as secure as
the weakest link in that effort. Worth remembering when SR3.0 comes out. Is it
being run by someone else who will put out a hit on a rival, or plow $70k of
revenue into a Model S.

~~~
steveeq1
Silkroad 3.0 will probably be this:
[https://openbazaar.org/](https://openbazaar.org/)

Good luck in taking that down.

~~~
pyre
Interesting. Are you claiming that OpenBazaar will be free of bugs, exploits,
side-channel attacks, etc? Have you done an analysis of the code? Got a link?

~~~
higherpurpose
I think he just meant that it's like Bitcoin. To stop Bitcoin, you need to
seize everyone's computers.

------
crazypyro
I think this is the money quote:

"During the Government’s investigation, which was conducted jointly by the FBI
and HSI, an HSI agent acting in an undercover capacity (the “HSI-UC”)
successfully infiltrated the support staff involved in the administration of
the Silk Road 2.0 website, and was given access to private, restricted areas
of the site reserved for BENTHALL and his administrative staff. By doing so,
the HSI-UC was able to interact directly with BENTHALL throughout his
operation of the website."

So I assume this means they were able to infiltrate the community and there
was possibly no unauthorized break necessary on the actual technology stack.
It does lead one to question how they drew the final line between Benthall and
his online persona, unless the undercover agent was also given access to
financial information or other personally identifiable info. Maybe they even
placed a malicious program on the server to target Benthall after they had
control of a support backend. Interesting to see if that is all that comes
out....

~~~
chatmasta
This sounds no different than the undercover police, detective work the FBI
has been doing since its establishment. Infiltrate the perp, take him down.

They used the same tactics on gangs, mobs, etc. Now violent crime is slowing,
but they have hoardes of agents trained in these protocols, so they're
redirecting energy into catching so called "cybercriminals."

A bunch of people who infiltrated the mob are now infitrating groups of nerds
in basements. It's frustratingly hilarious.

By the way: If the FBI is so successful using traditional police tactics to
infiltrate "cybercrime syndicates," why do they need a "front door" to our
devices?

~~~
rayiner
> A bunch of people who infiltrated the mob are now infitrating groups of
> nerds in basements. It's frustratingly hilarious.

I'm a little skeptical of this whole shtick that online criminals are just
"nerds in basements." A nerd can do a lot more damage to your life with a
computer than your average petty criminal.

~~~
anigbrowl
True, but that doesn't necessarily mean they will. One of the smarter things
about Silk Road in my view was the nominal policy of disallowing trade in
child pornography, criminal services, stolen credit card data and so on, ie
illicit things that also have (or are intended to have) victims who are
necessarily injured as a condition of production. There's no economic tipping
point at which the consumption of child pornography could justify the abuse
perpetuated in its production, for example.

While the drug trade can cause people to become victims (just as the legal
trade in alcohol or cigarettes or many other commodities), such victimhood is
incidental to the production and consumption of the illicit good rather than
inherent to it. I think this distinction between what sorts of contraband
could be traded on Silk Road (even if it was not adhered to in practice) is a
big part of why many people were/are sympathetic towards Silk Road.

~~~
eyeJam
One of the most astonishing parts of dark markets is that it flips the drug-
dealing paradigm. Instead of watered-down product sold by unsavory people only
motivated by profit, we now have what are essentially drug aficionados who are
earnestly interested in selling the best possible product.

Which isn't to say they're allergic to profit, but since its closer to an
open-market they can no longer rely on being the only game in town. Testimony
from buyers on the dark markets shows that some dealers even include free
drugs, which is completely unheard of.

If the cocaine cowboys of the 70s and 80s were the first wave and the crack
kingpins of the 90s were the second wave, then the cyber vendors are the third
wave drug dealers.

------
macrael
"On or about October 7, 2013, the HSI-UC [the undercover agent] was invited to
join a newly created discussion forum on the Tor network, concerning the
potential creation of a replacement for the Silk Road 1.0 website. The next
day, on or about October 8, 2013, the persons operating the forum gave the
HSI-UC moderator privileges, enabling the HSI-UC to access areas of the forum
available only to forum staff."

They were compromised from day 1, before the 2.0 site had even launched. I
wonder how they managed to be a trusted admin so quickly?

~~~
wmf
That sounds like the FBI had already infiltrated the Silk Road 1.0 community
so they were invited into 2.0 at the beginning.

~~~
macrael
That might have the most chilling effect on a 3.0.

~~~
tedunangst
WANTED: rockstar programmer for new e-commerce startup. still in stealth mode,
but think silk road with less php and more rails. bitcoin
experience/enthusiasm a plus. message for details. no feds please.

~~~
ZeroFries
Better watch out, law enforcement isn't exactly known for their sense of
humour.

~~~
mpyne
Perhaps, but that kind of joke gets made all the time on the Internet without
bringing down black helicopters.

~~~
jrockway
I made a joke like that on Slashdot once and the black helicopters did show
up. Well, the Secret Service, anyway.

~~~
mpyne
You satirically quoted an imaginary job posting and Secret Service showed up?
That sucks, I guess we need to close down Duffel Blog and The Onion then.

~~~
coldtea
Or you know, he did a SLIGHT VARIATION of the "imaginary job posting", an
"imaginary something else" but equally imaginary and tongue-in-cheek...

~~~
mpyne
Yes, I'm _sure_ that his "not actually the same as the joke we're talking
about" joke was a mere slight variation. Maybe the Secret Service guy missed
the (+5: Funny), I'm sure that happens to the best of us sometimes.

~~~
coldtea
Yeah, because secret service and/or cops are known to have a great sense of
humor and enough understanding of the Web (including Slashdot trivia).

------
ChuckMcM
Maybe the title should be, "FBI Announces Silk Road 3.0" :-) And I agree,
folks seem to be running these things out of the US rather than out of say the
Cayman islands or Belize where is it easier to level the playing field with
respect to the authorities.

~~~
eksith
I'm not so sure. There have been offshore gambling sites (sports, poker
etc...) that have been shut down before with the cooperation of local
authorities, although not always easily. They may see revenue for local
industry as a nice plus, but not so nice as to risk the ire of the U.S. govt.

In the end, your allies offshore may only be as loyal as the force they're
willing to ignore. And your friends may only be as trustworthy as the
information you choose to share with them.

Edit: Link to that poker takedown news
[http://www.covers.com/articles/articles.aspx?theArt=234980](http://www.covers.com/articles/articles.aspx?theArt=234980)

~~~
duaneb
With TOR, though, it's very easy to move servers quickly. Who wants to play a
foreign game of 'whack a mole'? Authorities will tire quickly of complying
with an endless game.,

~~~
yourad_io
I'm not sure how this is a whack-a-mole game.

If you run a single-server hidden service, the NSA _can_ track it (unless you
think otherwise - tried to initiate discussion here[1]).

Once they track it, they _will_ get your hosting provider to cooperate and
before you know it, your server has been imaged and that irrevocable .onion
private key is in the authorities' hands. The most you'll see from your end
was some downtime, which a cooperative host (an assumption here, granted)
would cover up for the FBI (status update: rack/sector/DC failure at XXX).

They can now impersonate your server, MitM you, the works. After that, in
order to move, you have to _literally move_ to another onion address.

What you're saying makes sense if there is anyone who habitually rotates
servers as a matter of OPSEC, but that sounds like an invitation for disaster.

AFAICT the name of the game isn't whack-a-mole, because when the NSA sees the
mole, it will whack it.

It's "bury the mole in the moleyard" \- multiple mirrors so as to make
locating the actual service very unlikely.

[1]
[https://news.ycombinator.com/item?id=8568667](https://news.ycombinator.com/item?id=8568667)

~~~
zanny
I'm wondering why they would image the server. Did SR2 not use full disc
encryption using LUKS? How would they be able to access anything on it, I know
if I were running SR2 I'd have the longest private key ever stored in my brain
to decrypt the drives.

~~~
yourad_io
> I'm wondering why they would image the server.

For offline analysis and to be used as evidence, presumably.

> Did SR2 not use full disc encryption using LUKS? (...) longest private key
> ever

So the process for you would be slightly different: There would be a "power
outage" in your rack, your encrypted disk would be imaged and (unencrypted)
bootloader would be bugged.

Then they'd wait for you to see that your server had some issues, upon which
time you'd have two choices:

-enter your private key to resume the service.

-abandon the server.

The correct choice would be (2), but you don't have enough information to make
that call.

~~~
feld
It's not log bugging your bootloader can magically send your password for the
key off the server. They would have to be watching and be very quick, but I'm
sure they'd want to see the server start to boot to ensure they have it.

I'd compare the bootloader to a known good image as an early boot step and if
it isn't what you expect immediately start destroying data. :-)

~~~
yourad_io
I meant "power outage" as the pretext that would justify (to the HS owner) why
the server has been power-cycled (assuming they decided to cooperate with the
FBI/whoever).

Here's how I would do it:

\- I assume that your hard drives are in RAID. I gamble that they're in RAID 1
- most typical - and strip one out while the server is still running. Some
kernel messages are logged, whatever.

\- I start imaging the disk. If it isn't a mirror of the other after all, I
strip the remaining drive(s) out and start imaging them too.

\- While the disk(s) is/are transferring, I patch both your boot loader and
your kernel with a rootkit. This should be laughably easy for the level of
adversary we're talking about.

\- When the disk(s) are done, I power cycle your server. I may cold-boot your
RAM and get the passphrases there if i'm lucky. The downtime was either
seconds (if it kept going with one RAID 1 disk) or <however long the imaging
takes>.

\- When you realise your service is down you may contact customer support. In
that case they will respond (with their usual timing) about something-
something-blown-fuse-UPS in your rack.

\- When you log onto your server, you will most likely be faced with the
passphrase input and most likely will go for it, but even if you don't...

> I'd compare the bootloader to a known good image as an early boot step

If you do so after you've given away the passphrase, you've lost already.
Destroying the data won't help, as they have the encrypted copy of it and you
just gave them the key.

I don't think you could detect a good boot/OS rootkit remotely at all. One
would cover for the other. You can't unplug the disk and examine it. You can't
plug a read-only drive in and boot some forensic tool. All you have is your
lying bootloader and your lying OS. Your encrypted partition doesn't protect
the integrity of the binaries there either, as after it's been decrypted, the
rootkit would happily intercept any values that would give it away.

I'm not sure how you could ensure hardware security without ensuring physical
security. Usually, physical access == pwned. Maybe TPM changes/will change
that, but I somehow doubt it. Some other routes not covered here (probably
easier, heh): Getting host to decrypt your TLS/KVM session where you typed the
passphrase in the first place, malware in firmware on misc devices, etc.

~~~
zanny
> I patch both your boot loader and your kernel with a rootkit. This should be
> laughably easy for the level of adversary we're talking about.

Well, you won't be getting the kernel, its on the drives. It would have to be
in a separate partition so you can start it before mounting the sensitive
filesystems, and you may have a key that the bootloader uses on it, but in
either case if you are not present and a sever goes offline you basically have
to do the following:

Verify the ROMs integrity in that first stage - before you put in the key for
your actually sensitive data. That means you need open firmware or some
mechanism to hash the ROM that is installed, you need to have a means to read
it in its entirety, and then you need to hash it.

I say open firmware because you need to be able to guarantee the FBI couldn't
embed a backdoor firmware. If you can get open spec / openfirmware mainboards
and verify their authenticity only then can you be safe.

Then you verify the kernel, which is much easier because you can compile it
yourself, maybe even pad it with some random and scramble the ELF tables in
some custom orientation.

And then you need to worry about how you input the key - if its by USB, you
can backdoor the USB and network controllers and keylog in hardware depending
on the vendor and model of the mainboard. Over the network, just the NIC is in
question, because any secret sharing over ethernet better be over a secure
connection.

But that should be it. It is a fine line at best, and a bottomless pit at
worse, but there are ways to try to be hardware secure.

~~~
yourad_io
> Verify the ROMs integrity in that first stage (...) need open firmware or
> some mechanism to hash the ROM that is installed, you need to have a means
> to read it in its entirety"

Does such a mechanism exist? If you can do this[1] from BIOS, why is it safe
to assume that the same can't be done for the dump-bios-image routine? AFAIK
the BIOS handles this in real-mode [2] (overrides the OS), and "returns" the
image by copying it somewhere in low memory. So, you're trusting the BIOS that
it's copied the right data out for you. (goodguybios)

> I say open firmware because you need to be able to guarantee the FBI
> couldn't embed a backdoor firmware.

This reminds me of this NSA _RAID controller_ rootkit for Dell Poweredge
Servers [3]. Nuts. Every closed firmware on your servers is a potential hiding
place to someone with (soldering-iron-to-the-motherboard) physical access.

In our Dread Pirate use case, you don't even have to think that far as you
can't ensure your own BIOS. Who are you going to buy TPM servers [4] from,
when you're defending against the FBI? Intel? HP?

The Rootkit wikipedia page is alarming, to say the least. [5]

\--

[1] A Real SMM Rootkit: Reversing and Hooking BIOS SMI Handlers
[http://phrack.org/issues/66/11.html#article](http://phrack.org/issues/66/11.html#article)

[2]
[http://en.wikipedia.org/wiki/Real_mode](http://en.wikipedia.org/wiki/Real_mode)

[3] [http://resources.infosecinstitute.com/nsa-bios-backdoor-
god-...](http://resources.infosecinstitute.com/nsa-bios-backdoor-god-mode-
malware-deitybounce/)

[4]
[http://en.wikipedia.org/wiki/Trusted_Platform_Module](http://en.wikipedia.org/wiki/Trusted_Platform_Module)

[5]
[http://en.wikipedia.org/wiki/Rootkit#Bootkits](http://en.wikipedia.org/wiki/Rootkit#Bootkits)
("Bootkits??")

[6] [https://www.blackhat.com/presentations/bh-
usa-07/Heasman/Pre...](https://www.blackhat.com/presentations/bh-
usa-07/Heasman/Presentation/bh-usa-07-heasman.pdf)

------
unchocked
"Benthall should have known that those who hide behind the keyboard will
ultimately be found."

What a weird tone...

~~~
openssj
In which the purpose of the press release (and bust) is revealed: to threaten
the public and make an example.

The usual stuff you expect out of an upstanding agent of democracy.

~~~
krapp
Shame on the US government for threatening the public with the enforcement of
its own laws.

~~~
openssj
That statement nonspecifically threatens anyone who "hides behind a keyboard".
Also, this threat comes without any determination that the law has been
broken; there has been no conviction.

I have no problem with assurance that the law will be faithfully executed.
This isn't that. This is inflicting fear to suppress people you disagree with.
If only we had a buzzword for that.

~~~
tedunangst
This is assurance to the public that the law will be faithfully executed. They
are assuring the public that the FBI is capable of investigating crimes even
on the internet.

~~~
disposition2
It would just be nice if they operated under the same judicial rules that they
are enforcing. It seems like a large portion of US agencies (who enforce
'justice' in one way or another) these days feel like the same laws they are
enforcing don't necessarily apply to them, especially when said law(s) limit
their ability to do their job.

Or more simply put, exceptional circumstances have now become a rule rather
than an exception.

~~~
Touche
Specifically which laws did the FBI break in this investigation?

~~~
disposition2
I'm not sure if they did, "in this investigation".

I was commenting more on the general tone of US agencies, since the PATRIOT
ACT, and their contradictions of what is breaking the law when it applies to
them vs. whomever they are investigating.

~~~
mpyne
Commenting more on the general tone of US agencies, since _changing the law to
specifically allow an expanded set of investigatory techniques_ , is them
"breaking the law"? What?

You can argue they shouldn't have such authorities, but when the law
explicitly gives them authority it's foolish to then claim they're breaking
the law when using those same authorities.

~~~
lazaroclapp
It can still be breaking the law if they: a) exceed even the authority granted
to them explicitly by the Patriot Act or b) the contents or interpretation of
the Patriot Act violate the letter (and possibly the spirit/interpretation) of
a higher law, namely the Constitution. IANAL so I don't know whether either of
those are true, but is something that has been called into question (beyond
the ethical or social-impact concerns over the laws and practices enabled by
the act). I don't feel shutting down a black market is illegal (or unethical)
unless the means to do so were illegal (or unethical). However, saying that US
agencies violate the law more often after being given more powers within the
law is not necessarily a self-contradictory or strange notion.

------
yourad_io
I cannot imagine a way in which a _single-server_ hidden service is safe from
a global, active adversary like FBI, NSA & Friends.

This [1] discusses _passive_ analysis over time.

Isn't it really easy to locate one if you can perform active attacks on the
global infrastructure? (introduce latencies and/or break links temporarily)

If your hidden service is served by a couple of mirrors on each continent,
though... _then_ maybe you're safe?

edit: This is a genuine question, not a rhetorical one. Am I missing
something?

[1] [http://www.onion-router.net/Publications/locating-hidden-
ser...](http://www.onion-router.net/Publications/locating-hidden-servers.pdf)

~~~
avn2109
Good point. Noises have been made for a long time that Tor is compromised
given a sufficiently motivated adversary. For instance, [0], among many
others.

In light of those noises, my non-rhetorical question is this: Why would any
Ulbright wannabe reside within the US DoJ's sphere of influence? Get thee to
Russia, and quickly! And while you're at it, keep your hardware in some third,
fourth, and fifth locations, neither American nor Slavic.

[0]
[https://www.schneier.com/blog/archives/2013/08/has_tor_been_...](https://www.schneier.com/blog/archives/2013/08/has_tor_been_co.html)

~~~
yourad_io
> Why would any Ulbright wannabe reside within the US DoJ's sphere of
> influence? Get thee to Russia, and quickly!

100% agree with this. I imagine it is mostly that people never think they'll
get caught - or they view the risk of getting caught as much lower than the
benefit of not moving, in any case.

 _Edit 1_ : To add: I think "people" also underestimate _just how easy it is
to get caught_.

Getting caught doesn't mean you're stupid, or inexperienced, or anything
except that you slipped _once_.

You forgot the proxy, once. You sent your personal pubkey your rather your
darknet pubkey, _once_.

It takes next to nothing at all to get caught.

 _Edit 2_ : The link you posted was about a javascript 0day exploit in the Tor
Browser Bundle. Implementation flaws will always be there, but if the theory
is broken as well... My question is about if the tor protocol itself could
theoretically shield a hidden service from a global, active adversary. Which I
think it couldn't.

~~~
pcthrowaway
Hopefully anyone doing this in the future would be doing so only from Tails
and public internet cafes

------
kazazes
I won't link to them directly, but his accounts on most social networks are
not deactivated, are publicly viewable and all mention bitcoin in the bio. In
the wake of DPR 1.0 I find this a bit hubristic.

~~~
danielki
That's not the worst of it - the criminal complaint mentions that the server
was registered to the email address blake@benthall.net. If that's not a giant
"hey, feds, come and get me", I don't know what is.

It also mentions that most of the accounts (Bitcoin wallet and other) that he
used were all under his real name.

~~~
waterlesscloud
It's enough to make you wonder if someone set him up. Did they have something
conclusively linking him to the site in the real world?

------
Estragon
Why couldn't the FBI land this case by itself? What are the responsibilities
and special investigative powers (if any) of "Homeland Security
Investigations." How do they justify their existence independent of the FBI?
Their webpage suggests they do almost exactly the same thing.

[http://www.ice.gov/hsi](http://www.ice.gov/hsi)

~~~
mpyne
ICE is the agency that handles customs inspections, and presumably get called
in for any type of smuggling of contraband that crosses national borders.

It would make a lot of sense for the Federal government to have a single
agency that investigates all computer-related crimes, but since that would
make sense it will never happen. Instead each agency (FBI, US Secret Service,
ICE, etc.) will investigate computer-related crimes that tie into their
bailiwick, likely cooperating for cases that cross jurisdictional boundaries
like this case did.

------
andrewljohnson
These guys should stop operating out of the US. They might last longer.

------
kyledrake
Thank god, I was worried that my violent street gang was going to lose
business.

------
hackerboos
A twitter and github account based in San Francisco with a similar name has
been quiet for over a month.

Interests include Bitcoin.

~~~
MacsHeadroom
He posted on Instagram just 5 days ago
[http://instagram.com/blakeisblake](http://instagram.com/blakeisblake)

------
swartkrans
Here's a recent image of the person charged from his instagram:

[http://instagram.com/p/uyqRk1CXWk/](http://instagram.com/p/uyqRk1CXWk/)

Prophetic.

~~~
Magi604
Oh my.

Rocket Scientist at SpaceX? I think his career might be put on hold for a
while.

~~~
adamnemecek
He's all about getting high.

------
chatmasta
How is the FBI going to handle an inevitably popular decentralized
marketplace? Will they prosecute anyone who downloads the marketplace software
onto their computer?

All the pieces are in place for a true p2p marketplace. It doesn't exist yet,
but it will soon.

EDIT: I should read about OpenBazaar.

~~~
jedunnigan
I think we will arrive at a future where it will no longer be legal to create
such software. The FBI will then go after the developers of said platforms.

Of course they will still go after the large sellers and such using
traditional investigative techniques.

------
Caligula
I think this may be his hn account.
[https://news.ycombinator.com/user?id=blakeeb](https://news.ycombinator.com/user?id=blakeeb)

~~~
JTon
A software engineer at Space X [1] is also behind Silk Road 2.0? Crazy

[1]
[https://news.ycombinator.com/item?id=7277371](https://news.ycombinator.com/item?id=7277371)

~~~
throwawayornot
"when I look back I will clearly view the code I've written here to be way
more important for humanity's progress than the code I've written for
entrepreneurs' selfish attempts at billion dollar exits"

~~~
mikeyouse
Everyone should note that he worked at SpaceX for _5 months_..

------
lelf
Quote from [http://www.irishexaminer.com/breakingnews/ireland/gardai-
sei...](http://www.irishexaminer.com/breakingnews/ireland/gardai-seize-drugs-
after-probe-into-darknet-drug-operation-650036.html)

 _An international day of action to disrupt global activity on the Darknet and
remove certain websites and forums is to conclude within the next 24 hours
under the FBI /Europol operation codenamed "Onymous"._

~~~
genev
Very impressed with the codename.

------
chrisdevereux
Anyone who knows more about tor than me care to explain how DNS works on onion
sites?

I assumed that it would be distributed in some sort of way that prevented this
sort of thing from happening? Or does transferring ownership require the
owner's credentials to be compromized?

~~~
mschuster91
You seize the server running the tor software serving as entry-point for your
hidden service and grab the private keypair in order to impersonate the hidden
service.

The .onion address is iirc a hash of the public key.

~~~
chrisdevereux
By entry-point, do you mean a server that you would typically own/rent, or
some other server in the tor network that you would not normally control?

~~~
mschuster91
The first one. In an ideal world (tm) you have two physical servers srv0/1,
both with full-disk encryption and some form of remote KVM. srv0 is connected
to the internet on eth0 and to srv1 on eth1.

Then you set up networking in a way that the only thing aside from absolute
required services running on srv0 is your tor gateway, and no traffic from
eth1 may pass through to eth0.

On srv1 you set up the usual services, e.g. mysql, lighttpd and whatever you
need hosted.

Ideally, you keep srv0 and srv1 in different datacenters, if not even
different countries.

------
typedweb
There are already movements to decentralize Silk Road type sites using P2P
technology, like OpenBazaar:
[https://openbazaar.org/](https://openbazaar.org/).

------
DevX101
To anyone thinking about 3.0, just move to another country.

Preferably one that likes to stick the finger to U.S. and extradition
requests. Bring along some extra bitcoins for the local police though.

------
jrobertfox
I actually had this guy interview me for a first round at SpaceX. Seemed nice
enough and we chatted further. By the time I flew in for the onsite he had
"left." Cool dude.

------
knd775
Wow. The guy's social media accounts indicate that he is a rocket scientist at
SpaceX.

~~~
mikeyouse
Meh.. it looks like he was only there for 5 months and that he quit in March
(presumably to work on SR2.0 full time).

~~~
feld
Unlike at SpaceX, at Silk Road 2.0 the sky is the limit

------
zanny
Good news for bitcoin though, all these hidden service seizures and the price
has barely budged. It is actually up a bit since this morning.

~~~
mikeyouse
I think "Good News for Bitcoin" should be attached to a little trademark icon
every time the phrase is uttered.

------
smsm42
>>> and Peter Edge, Executive Associate Director of Homeland Security
Investigations (“HSI”),

I wonder how is it "Homeland Security". Looks like this confirms "Homeland
Security" is completely coopted into War on Drugs. Not that after this:
[https://www.eff.org/deeplinks/2014/10/peekaboo-i-see-you-
gov...](https://www.eff.org/deeplinks/2014/10/peekaboo-i-see-you-government-
uses-authority-meant-terrorism-other-uses) there was any doubt, but basically
every time they talk about doing something to fight terrorism, it's probably
means drug enforcement.

~~~
mpyne
ICE (Immigration and Customs Enforcement) is responsible for controlling the
import of goods (such as counterfeit Dutch passports and ID cards, but
probably including drugs too) into the country, and they're a part of DHS.

------
imaginenore
OpenBazaar.

[https://openbazaar.org/](https://openbazaar.org/)

------
decisiveness
I feel like this information might make some deviously smart individuals think
they can get away with it by not screwing up where Benthall did.

~~~
wmf
Like he probably thought he would't screw up the same way Ulbricht did?

~~~
decisiveness
Yup, but the one takeaway I get from these court documents is the FBI needs
someone to make some bone headed mistakes in order to bring them to justice.

------
chatmasta
What are the chances that the FBI set up a number of "copy-cat-silk-road"
hidden services, immediately after seizing the original? That would provide
them ample opportunity to 1) build a profile of everyone who used them, then
2) shut them down with an intimidating "sting," dampening the desire of
potential copy-copy-cats.

~~~
Estragon
If Blake Benthall actually does prison time, I'd say that's extremely
unlikely... I suppose the FBI could have been behind the original setup and
then sold it to him...

~~~
chatmasta
Or he's a government agent. After all, who's really verifying he a) exists, b)
goes to jail?

Ok, that's enough fearmongering paranoia for me today. See you tomorrow hacker
news! :)

------
batrat
So what? 100 more will arise. And this time not US based. You close 1 100 more
will appear.

~~~
wpietri
Marketplaces work much better at scale. And entrepreneurs do better the more
they are connected with their markets. So from the government perspective, 100
kittens is way better than 1 lion.

The government doesn't have to make these disappear. They just have to
increase the perceived risk and decrease their effectiveness until they're no
better than buying on well-known corners or getting the phone number of that
one friend's friend's friend.

That's mainly because drug practical prohibition activity is about
suppression, not elimination. But I think it's worth noting that cops get paid
to fight crime, not defeat it. As a general rule, I expect long-lived
organizations to act in ways that self-sustain.

~~~
kirsebaer
Drug prohibition is about police departments getting federal grant money based
on how many arrests they have made, seizing property of people arrested for
drug crimes, and getting bribes from large-scale dealers.

------
sisk
Curious if anyone has any idea how he was facilitating this:
[https://github.com/blakeeb/private](https://github.com/blakeeb/private)

------
anonbanker
so, is everyone ready to ditch Tor for i2p yet?

~~~
darkstar999
It wasn't a protocol issue/backdoor. It was social engineering.

~~~
anonbanker
Against an adversary tapping the entire network, i've already switched to
I2P/Tahoe-LAFS for my private communication/file transferring. It's where Silk
Road 3.0 should be located.

------
base698
What does this mean in the wake of Prop 47?

~~~
greensoap
Nothing. Prop 47 is a state measure for simple possession. This is conspiracy
to traffic, interstate wire fraud, federal crimes prosecuted under federal
statutes. Even if these were state charges Prop 47 didn't really change much
(or anything) sentencing for sales.

~~~
msandford
Conspiracy to traffic? Doesn't seem like it. Is it something that makes
trafficking easier? Sure. But who did the trafficking? The seller and the
buyer.

Wire fraud? If it's the sale of something illegal I don't think that suddenly
makes it wire fraud. Further, he's not charged with that. The sale is still
completed. It's an illegal sale, but not fraud. Fraud would be if someone said
they were going to sell you cocaine and instead shipped you powdered sugar.

~~~
Estragon
"Conspiracy has been defined in the United States as an agreement of two or
more people to commit a crime, or to accomplish a legal end through illegal
actions."

[http://en.wikipedia.org/wiki/Conspiracy_(criminal)#United_St...](http://en.wikipedia.org/wiki/Conspiracy_\(criminal\)#United_States)

Thus it's conspiracy if you are party to an agreement which involves you
receiving a bitcoin commission (legal end) as a result of the trafficking of
drugs (illegal action.)

If they're charging wire fraud, I think that may be part two of the complaint,
"Conspiracy to Commit and Aid and Abet Computer Hacking." Probably people were
using the site to sell hacking services or hacking tools which could be used
to defraud people.

[https://pdf.yt/d/RpyX9_xmapTkhmkb](https://pdf.yt/d/RpyX9_xmapTkhmkb)

~~~
NoMoreNicksLeft
What if you don't take a cut of the transaction? If there's some flat fee that
people pay regardless of whether there is an illegal drug transaction, is that
then a conspiracy?

~~~
mpyne
Perhaps not, but if you know (or reasonably should know) that a crime is being
committed and then don't report it, now you're an accomplice to the crime.

It's hard to miss all the ads for drugs on SR2.0, so it would be very easy to
prove that charge at the very least. And as we've seen in the past, Federal
prosecutors tend to be very inventive, and the law tends to be rather
expansive for these types of things, it wouldn't surprise me at all if there
are other charges that would be possible.

~~~
Estragon

      > if you know (or reasonably should know) that a crime is 
      > being committed and then don't report it, now you're an
      > accomplice to the crime.
    

It seems as though this depends on the state you're living in and the
seriousness of the crime.

I'd like to know what the relevant laws are (if any) in Ohio and New York.

~~~
greensoap
I don't know if any state that has mandatory reporting of all crimes based
solely on knowledge. Outside of mandatory reporting of child abuse for certain
individuals in specific roles (i.e. doctors, teachers, etc) so that those
people report despite confidentiality obligations.

But for the average joe walking down the street and witnessing a crime there
is usually no obligation to report that and they don't magically become
accomplice. Most state laws in the U.S. don't impose duties like that (or even
duties to help others) on its citizens.

Now, if your property is being used to commit a crime and you don't report it
there might be different implications. And if you don't report it then you are
going to have a difficult time proving you were involved. Guilt by association
type scenario and the jury is going to likely believe you were involved. But
this is not the same as becoming an accomplice because you didn't report the
crime.

------
theibgdeal
1) It's obvious now that TOR _or_ bitcoin has been compromised in some way
shape or form, allowing government strong arm agencies to once again subvert
US citizens privacy in order to catch a 'drug facilitator.'

2) I have never drank or taken drugs, but I respect the choice and liberty of
another person to do so, whether that be the invasive and deadly alcoholic
beverage or the noxious cancer causing cigarette, or even the cannabis that
retarded pot-heads smoke.

3) Its a shame the governments, christians, jews, muslims, swahilis and
everyone else can't do the same.

4) Thinking about it - having the drug trade on the internet, kept it out of
the street. No kids were used to distribute it across schools. No one got
robbed or beaten. No one got shot. That's more than you can say for the 'war
on drugs' and it's fallout. How many trillions have been spent, and how many
people have died because of it? How many non-violent potheads clog the
prisons?

*There are more people incarcerated in America, the home of the free, than there are in any other country in the world, apart from Seychiles... because the prison system has been privatized and again - people figured out how to make money by taking away the liberties of Americans.

[http://en.wikipedia.org/wiki/List_of_countries_by_incarcerat...](http://en.wikipedia.org/wiki/List_of_countries_by_incarceration_rate)

5) The drug trade had been around for a thousand years and it was never a
problem until the FBI, CIA and various interested parties realized they could
make money off of it.

~~~
ChristianBundy
> retarded pot-heads

Really?

~~~
boardstretcher
That's the part you have a problem with?

Telling.

