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FEATURES/Cross Border | Sep 26, 2013 | 9347 views

The Dread Pirate Roberts: Internet's Multimillionaire Druglord

Increasingly sophisticated anonymity tools have created a bustling online narcotics market and everything that goes with it: Turf wars, illegal guns, attacks on competitors—and one philosophy-spewing, multimillionaire drug lord: The Dread Pirate Roberts
The Dread Pirate Roberts: Internet's Multimillionaire Druglord
Image: Daniel Hertzberg

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n entrepreneur as professionally careful as the Dread Pirate Roberts doesn’t trust instant messaging services. Forget phones or Skype. At one point during our eight-month pre-interview courtship, I offer to meet him at an undisclosed location outside the United States. “Meeting in person is out of the question,” he says. “I don’t meet in person even with my closest advisors.” When I ask for his name and nationality, he’s so spooked that he refuses to answer any other questions and we lose contact for a month.

All my communications with Roberts are routed exclusively through the messaging system and forums of the website he owns and manages, the Silk Road. Accessing the site requires running the anonymity software Tor, which encrypts web traffic and triple-bounces it among thousands of computers around the world. Like a long, blindfolded ride in the back of some guerrilla leader’s van, Tor is designed to prevent me—and anyone else—from tracking the location of Silk Road’s servers or the Dread Pirate Roberts himself. “The highest levels of government are hunting me,” says Roberts. “I can’t take any chances.”

If Roberts is paranoid, it’s because very powerful people really are out to get him. In the last two-and-a-half years, Silk Road has grown into the web’s busiest bazaar for heroin, methamphetamines, crack, cocaine, LSD, ecstasy and enough strains of marijuana to put an Amsterdam coffee shop to shame.

The Drug Enforcement Agency won’t comment on whether it’s investigating Silk Road but wrote in a statement that it’s aware of the site and is “very proactive in keeping abreast” of the digital underground’s “ever-evolving technological advancements”. Senator Chuck Schumer has demanded Silk Road be shut down and called it “the most brazen attempt to peddle drugs online that we have ever seen… by light-years”.

Anyone can download and run Tor, exchange some dollars or euros for the digital currency Bitcoin and go shopping on Silk Road for drugs that are vacuum-sealed and discreetly mailed via the US Postal Service, right under the federal government’s nose. By the measure of Carnegie Mellon researcher Nicolas Christin, Roberts’s eBay-like service was grossing $1.2 million a month in the first half of 2012. Since then, the site has doubled its product listings, and revenue now hits an annual run rate of $30 million to $45 million by Forbes’s estimate. One analysis of the Tor network performed by a student at Dublin’s Trinity College found that Silk Road received around 60,000 visits a day, mostly users seeking to buy or sell drugs, along with other illicit items, including unregulated cigarettes and forged documents.

Silk Road takes a commission on all of its sales, starting at 10 percent and scaling down for larger transactions. Given that those commissions are collected in Bitcoins, which have appreciated close to 200-fold against the dollar since Silk Road launched in 2011, the Dread Pirate Roberts and any other stakeholders in Silk Road have likely amassed millions in profits.

Despite the giant DEA crosshairs painted on his back and growing signs that the feds are probing the so-called “dark web” that Silk Road and other black market sites inhabit, Roberts spoke with Forbes in his first ever extended public interview for a reason: As with physical drug dealing, a turf war has emerged. Competitors, namely a newly launched site called Atlantis with a real marketing budget and a CEO with far less regard for his privacy, are stealing Roberts’s spotlight.

“Up until now, I’ve done my best to keep Silk Road as low profile as possible… letting people discover [it] through word of mouth,” Roberts says. “At the same time, Silk Road has been around two-and-a-half years. We’ve withstood a lot, and it’s not like our enemies are unaware any longer.”

Roberts also has a political agenda: He sees himself not just as an enabler of street-corner pushers but also as a radical libertarian revolutionary carving out an anarchic digital space beyond the reach of the taxation and regulatory powers of the state—Julian Assange with a hypodermic needle. “We can’t stay silent forever. We have an important message, and the time is ripe for the world to hear it,” says Roberts. “What we’re doing isn’t about scoring drugs or ‘sticking it to the man’. It’s about standing up for our rights as human beings and refusing to submit when we’ve done no wrong.”

This article appeared in the Forbes India magazine issue of 04 October, 2013
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Comments (1)
Shawn Sep 26, 2013
It's ironic that Atlantis shut down before this article could even come out.
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