Moctar BouraimaRoss Ulbricht is a major figure, if not a symbol in his own right, in the history of Bitcoin. His notoriety is controversial as he is known to have founded and led the Silk Road platform, a sort of “eBay for drugs” on the darknet. He was arrested in 2013 and, two years later, a federal jury in Manhattan indicted him on several counts. These mainly concern computer hacking, aiding and abetting online drug trafficking and supporting criminal activity.
At his trial, Ross was convicted and sentenced to life in prison for operating a website on which others sold illicit products, primarily hard drugs.
However, it is also with this site that Bitcoin experienced its first concrete use case for electronic payment. This contributed as much to making cryptocurrency known as to demonizing it for its illicit uses.
For many bitcoiners, Ross Ulbricht is the man who popularized bitcoin and he became a hero in spite of himself, as a defender of individual freedoms.
Discover the story of this person and how they contributed to the development of bitcoin as a payment currency on the internet.
Who is Ross Ulbricht?
Born in 1984, Ross Ulbricht grew up in Austin, Texas. After high school, he received a full scholarship to the University of Dallas, where he earned a bachelor's degree in physics. Later, the genius of the dark web earned a master's degree in materials science and engineering from Pennsylvania State University.
During his studies, Ulbricht became interested in the writings of the economist Ludwig von Mises while he was still attending the University of Pennsylvania. The author notably maintained in his teachings that individuals must enjoy economic freedom to be ethically and politically free. Ulbricht also had as a model the American politician Ron Paul, known for his libertarian positions.
Ulbricht graduated from Penn State in 2009 and later returned to Austin to start his own business. Most of his projects ended in failure, including the creation of an online book sales business. He also tried his hand at day trading and producing independent video games, before creating the site that would make him famous: Silk Road.
At that point, Ulbricht came up with the idea of creating an online marketplace using Tor encryption and bitcoin, which was still in its early stages. Ulbricht claimed that by adopting encryption and cryptocurrencies, his marketplace could guarantee anonymity and protection to its users. It was certain that such a combination would certainly allow them to avoid government monitoring.
To do this, while bitcoin provides a decentralized transactional platform and anonymous, Tor effectively hides identity and location network participants. It is from this basic concept that the Silk Road site on the darknet will eventually develop.
The birth of Silk Road
2010 was the year Ulbricht first heard about bitcoin. The aspect that appealed to him about the technology was being able to make transactions independently, without central bank supervision. For him, this idea is the very representation of the libertarian principles of which he is a supporter.
Thus, users could buy and sell goods anonymously and without leaving traces of their transactions. Ulbricht's idea was to create a site on which everyone could sell items freely.
The first transaction on the Silk Road marketplace took place in January 2011. It was the sale of ten hallucinogenic mushrooms which Ulbricht himself cultivated.
Then, more than a thousand people signed up in the first two months, demonstrating the rapid growth of the market. Ulbricht ran the website anonymously under the pseudonym Dread Pirate Roberts, name borrowed from a character in the film The Princess Bride.
Furthermore, Silk Road was only accessible via the Thor network. It is an open-source, volunteer-run anonymity network that routes traffic through intermediary servers and obfuscates IP addresses. Additionally, due to the supposed untraceability of bitcoin, all transactions were carried out using it.
During its brief existence, the market had more than 100 customers and generated a turnover of almost $000 million, 200% of which was directly linked to the sale of illicit substances.
Additionally, the website's terms of service prohibited the sale of goods with the intent to "harm or defraud," such as child pornography, fraudulent credit cards, firearms, and murder. However, this did not prevent the site from facilitating all these activities despite the ban from administrators.
Arrest and trial complications
The investigation into Silk Road involved several US agencies, including the FBI, the DEA and the IRS. These entities worked together to find Ulbricht. They were also able to get their hands on other site administrators and operators who sold and transported illegal substances.
The affair began to take shape when a FBI inspector interested in username “altoid” on an advertisement on the Silk Road website. He notably compared it to a deleted post by the same username on another forum asking for programming help. This led to a message containing an email address with Ulbricht's real name.
After this discovery, federal agents quickly seized Ulbricht's laptop before any software or files could be deleted. He was then apprehended at the Glen Park branch of the San Francisco Public Library in October 2013 and the immediate shutdown of his website resulted in the seizure of 144 bitcoins.
In February 2014, Ulbricht was charged with a number of offenses. This involves running a criminal enterprise, drug distribution, money laundering and computer hacking. He also allegedly hired a hitman to try to silence one of his collaborators.
However, Judge Katherine Forrest dropped a number of these charges due to a lack of formal evidence. There have been several controversies due to false evidence provided by members of the FBI. More than that, the investigation was conducted in a dishonest and misleading manner. Indeed, the hitman case was a lie invented by DEA agents Carl Mark Force IV and Shaun Bridges. The latter had stolen bitcoins worth $730 and were tried and convicted for it.
The request for the release of Ross Ulbricht
It took Judge Forrest nearly two years to decide the Silk Road case. His decision resulted in a double life sentence, plus 40 years of imprisonment without the possibility of parole.
Since then, Ross Ulbricht has been incarcerated at the Metropolitan Correctional Center in New York to serve his sentence…
Many people from the Bitcoin community and others are fighting to reduce Ross Ulbricht's sentence. Grouped under the collective " Free Ross Ulbricht"They consider the sentence too "harsh" and unfair. On the site, we learn for example that some drug sellers on the platform were sentenced to 5 or 10 years in prison while Ulbricht was sentenced to life imprisonment.
It is possible to support Ross Ulbricht on the site by signing petitions, sending books or even writing directly to the founder of Silk Road.
The "FreeRoss" collective points out that Ross Ulbricht was not convicted of selling drugs or illegal items himself, but was held responsible for what others sold on the site. It is recalled that on the site, it was forbidden to sell illegal products.
Defenders of Ross Ulbricht's liberation insist that he is more of a libertarian than a criminal and that Silk Road was only the realization of his libertarian ideas, for a world where everyone is free to choose. Thus, Ross Ulbricht is not considered as a criminal but as a defender of individual freedom, also advocated by the cypherpunk, philosophy which is at the origin of the creation of Bitcoin.
This explains why many bitcoiners support Ross Ulbricht, because he shares the same values of defending privacy and has directly contributed to the adoption of bitcoin among an ever-growing population.
The Impact of Silk Road on Bitcoin Adoption
The Silk Road marketplace, the darknet's first open marketplace, was a site accessible via the Tor network. It allowed users to buy and sell goods (often illegal drugs) by paying in bitcoin. You then had to obtain bitcoin to be able to purchase products, just as you needed a wallet to receive bitcoin payments.
Therefore, the Silk Road site has greatly contributed to the rise of Bitcoin. Many users of the platform discovered bitcoin this way. Better yet, it was also with Silk Road that the first concrete use case for bitcoin as a means of payment was implemented. We can also mention the article published on the Gawker blog, in January 2011, which was the first article to talk about the SilkRoad site, and which indirectly made bitcoin known to as many people as possible.
Indeed, around 80% of all bitcoins in existence at that time had passed through the Silk Road site. A situation which nevertheless caused a lot of damage to Bitcoin, particularly from governments who saw it as a tool serving illegal sites…
In a statement to the court, Ulbricht claimed that SilkRoad was designed to give individuals the autonomy to pursue their own pleasure and make their own decisions. Nevertheless, he added that his idea turned out to be a crazy and expensive project that he regrets having implemented.
According to Ross Ulbricht's personal philosophy, drug use was part of everyone's private life. He was an advocate for the legalization of drugs (cannabis in particular) because it would provide a better quality product while protecting users.
Confusions about bitcoin and crime
The affair had significant repercussions on the Bitcoin ecosystem growing. However, the image of Bitcoin has also suffered. Indeed, very quickly, the association of bitcoin with criminal activities was popularized. Among the many prejudices and preconceived ideas that are conveyed around Bitcoin, certainly, the best known is the one that makes bitcoin the ideal currency for criminals.
However, since the closure of the SilkRoad site, bitcoin has continued to gain momentum and adoption is ever greater. Since then, and with ever more “crypto-friendly” countries", bitcoin has become a popular investment asset among the world's largest financial institutions. Although bitcoin was originally used on illegal sites, today it has become an accepted means of payment in legitimate and legal stores around the world. In fact, it can be pay for more and more goods and services in bitcoin, moving us further and further away from the first so-called “criminal” uses.
Finally, Bitcoin owes a lot to the SilkRoad site and Ross Ulbricht, even if the association with criminal activities has at the same time limited the meaning of bitcoin as legal tender...
To go further on the Silk Road affair, here are some resources of articles, films and documentaries likely to interest you:
- Film "Silk Road" by Tiller Russell available in streaming on Amazon Prime (One month free subscription)
- Wired article: https://www.wired.com/2015/01/heres-secret-silk-road-journal-laptop-ross-ulbricht/
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