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Samizdata, derived from Samizdat /n. - a system of clandestine publication of banned literature in the USSR [Russ.,= self-publishing house]

Oh, the horror of the darknet…

The New Scientist Christmas number carries an interview with Carmen Weisskopf of the Swiss group Bitnik who carried out an automated random shopping expedition on the anonymous (or anonymous-ish) ‘darknet’. A place that official propaganda would have us believe is a Mirkwood full of hidden horrors.

What about trust? Has the bot been scammed yet, and paid for good that haven’t been delivered?

No. And this shows the level of trust that is there. The people who sell on these markets are used to trusting people online, and want to get a good rating. Even the Swiss police who seized the ecstasy bought by our bot were surprised at its quality compared to that available on the streets.

Honesty is not a product of fear of the police and state surveillance – shock. Not of course news to anyone brought up before the 20th century, nor in any of the many present-day societies where official power is the leading source of corruption.

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17 comments to Oh, the horror of the darknet…

  • When talking about manufactured products such as Ecstasy/Molly (MDMA), I was under the impression that there was an actual black market (certainly this was true during the 90’s rave period) and that specific branding and marketing was used on tablets as signs of consistency of production if not just quality, so I’m unsurprised that drugs purchased through the Silk Road and other sites on the Tor network are of better quality than goods sold on the street by local criminals?

    The popularity of the Breaking Bad TV series has resulted in Blue varieties of crystal meth being sold across the US and Europe (using food colouring to achieve the blue colour) as a popular marketing ploy amongst drug dealers because of the perception that blue meth is purer (actually utter nonsense)

    So quality, branding, customer service and other aspects that we associate with legal markets are also true of the black market – quelle surprise!

  • Paul Marks

    Odd that my stuff never appears here – but such is life.

    Yes the reputation of a business is what matters – as Adam Smith pointed out (and many pointed out before him – going back to the Scholastics) it is not in the interests of a business to poison its customers. And rivals (and the media) will be only too happy to expose scandals.

    Milton Friedman was fond of pointing out that “Underwriters Labs” (for the insurance companies and others) tested for safety in equipment long before the Federal government did – and far more efficiently.

    As for the “Dark Web”.

    Not quite the same thing as a shop of High Street.

    My concern would be that a seller on the “Dark Web” would keep their contracts for a while – till a really large amount of money came their way, then they might vanish (without delivering the goods – or delivering substandard, perhaps dangerous, goods).

    It is best to do business with people who you can find – if things go wrong (or if they cheat you).

    By the way the post seems to be confessing to buying illegal products.

    Getting involved in illegal markets is often unwise.

    Say, for example, bread was made illegal.

    Now there is nothing much wrong with bread (apart from for people who are allergic to it – or who eat too much of it and get fat). However, if bread was made illegal very dodgy people would be attracted to the illegal market in bread.

    And I would strongly advice Samizdatas NOT to get involved with such people.

  • Sam Duncan

    Or if it was rationed, Paul. During and immediately after WWII, some rather questionable people were dealing in bread, meat, booze, petrol…

    The trouble with black markets is that you can’t have any legal redress against the seller (except perhaps to expose his illegal activities to The Authorities and hope they’ll grant you immunity in return). Now, I’m not going to suggest that you need a state to create a system of non-violent arbitrated redress, but when one exists and you indulge in activity it prohibits, you’ll be very lucky to get any.

    Prohibition is a sort of self-fulfilling prophecy: the recreational drug market is dangerous largely, if not quite entirely, because it’s illegal.

  • Alsadius

    Having a lot of experience in markets where scamming is allowed(in videogames, not drugs, but people are people), Paul is perfectly correct. Creating a new identity and letting the old one evaporate is simply too easy, so you can trust them until you can’t.

  • Bod

    The Darknet is an inevitable result of technology addressing the needs of people. The barrier to widespread participation in trade is the relative effort required to set up the initial business, so naturally, the pioneers in this space will initially be those whose profits will be high – hence products which are specifically illegal.

  • Bod

    .. and if I hadn’t accidentally pressed …

    The point is that as the barriers to entry fall, you will get more reputationally-sensitive actors on the Darknet. For instance, I may legally purchase a firearm in the US, but if I could obtain a firearm that is (to a casual, uninformed observer) identical to one I already own, on the Darknet, I would do so, primarily because I want to ensure that if and when someone comes and deprives me of what I may *currently* own, I am not completely disarmed.

    There are suspicions that the current US administration’s next ‘push’ will be to make it very difficult to purchase ammunition “in bulk” over the internet. Expect the Darknet to become far, far more popular among the US populace if that happens, although as always, the delivery of a physical purchase is the point where risk is maximized. A round of .308 from a Walmart white-box purchase of 20 rounds looks just like the one I got in a case of 1000 rounds delivered by ammoman.com last week.

    The “Wild West” wasn’t really tamed by the presence of sheriffs – it was civilized by the growing number of basically ‘honest’ people living in the settlements, so I’d recommend that everyone gets more acquainted with a (currently) swashbuckling Darknet, while avoiding getting ripped off, in order to let it grow, by spontaneous order, into something more civilized, and hence, create a community with individuals that in general, value their reputation higher.

    Without, of course, destroying the anonymity. Sure, there are challenges to be met; personally, I’ve considered setting up a Darknet payment escrow service.

    The future of the Darknet doesn’t have to look like Bartertown.

  • TheSebastian

    To quote Bob Dylan, “To live outside the law you must be honest.”

  • Paul Marks

    Sam Duncan – exactly, quite so.

    And it is not just lack of legal address – one is dealing with people who do not care about their reputation, at least not “reputation” in the same sense a legitimate businessman does.

    Look how quickly dealing in drink went bad in the United States – as soon as the government made it illegal.

    It is indeed a self fulfilling prophesy – the government makes sure that the worst people are in charge of a market (by making it illegal – so only criminal types need apply) then points and says….

    “Look how terrible those people who trade in X are – this is why X must bed kept illegal”.

  • markets rule...

    Well anyone who pays UK tax on “fings” that can be delivered to your door is an idiot, right?

  • Fine, when we’re talking about drugs ‘cos “Drugs are bad man, mkay?” I can kind of see where you are coming from, but what about where the illegality arises from price controls and the black market you are primarily interested in is the one for Andrex triple-ply toilet paper?

    How about then? Because that is pretty much the situation you’ve got in Venezuela and it could happen elsewhere all too easily.

    The opposite is also true, in that if drugs were legalised on normal marketplaces (i.e. not a government or medical lobby monopoly), then they would be higher quality and a fraction of the price. Most of the problems with drugs arise from the War on Drugs itself rather than their use.

  • Julie near Chicago

    JG, that’s exactly why I was so surprised in the Black Market episode of 1990 to see that the hero — Jim Kyle — and the Reverend were just as sure the Black Market was Evil as was the Government (as represented by the Home Secretary). My thought was, “Evil?? I thought they were doing a public service!”

    You know, providing things like meat and fish as well as “liquor and cigarettes.”

    Anyhow, I certainly have gathered that at various times and places in the last 60 or 70 years, the “underground economy,” of which the black market is a part, really was the ordinary people’s lifeline. (And I think this story is probably as old as Man.)

    Still, Paul is right too: Yes, if buying bread is illegal there will be a black market in it, and when selling bread is outlawed, only outlaws will sell bread, and not all of those outlaws will really be displaced ranchers and businessmen with hearts of gold.

    It always comes back to the same thing. Laws “regulating” everyone and everything in sight are the cause of many ills, one of which is a high rate of popular lawbreaking just to stay alive.

  • Julie near Chicago

    Speaking of cigarettes and matters discussed above–

    This State Got a Harsh Lesson in Economics

    The bad, the worse, and the truly ugly….

  • Laird

    Good article, Julie. Thanks for the link.

  • Julie near Chicago

    :>)

  • Rich Rostrom

    “…it is not in the interests of a business to poison its customers.”

    But it may be in the short-term interest of a business to cut corners on safety and purity, and thereby reduce costs. The benefit to the business is immediate and definite, the risk to customers is long-term and potential. The risk to reputation is even more remote. This creates an incentive for the business to underestimate or ignore the risk.

    Business owners and managers are susceptible to the lure of immediate gratification.

  • Alex

    Rich, there is always going to be an element of buyer beware. Trade always involves at least 2 parties, it is the responsibility of the seller to ensure that their interests are protected e.g. that the money is not counterfeit, it is the responsibility of the buyer to look after their interests, e.g. to ensure the goods are not counterfeit. There has been a tendency this last century for consumers to decide that the responsibility of looking after their interests belongs to a third party. It doesn’t.

  • New York has been the classic example of “How to make tax revenues shrink by increasing tax rates” since at least the 1960’s and many of the economic articles on tax incidence and Laffer Curve theory use New York City cigarette taxes as an example, primarily because there are so many legal and illegal ways of buying cigarettes which legally avoid or illegally evade the tax.

    – Given the vast numbers that flood into New York by road and rail these days, many can simply purchase cigarettes at the train stations where they board outside of New York where taxes are lower – perfectly legal.

    – New York City residents might make an occasional trip into Virginia to stock up on cigarettes in bulk and then drive them back to New York, not quite so clear cut, because anyone can legally possess up to two such cartons for personal use, a smoker with the odd out-of-state pack is immune from any penalties at all. As long as they are not caught with a stash of cartons en route from Virginia or at home.

    And for smugglers, the rewards can be huge. With a van and some start-up money, a day trip to Virginia — where cigarettes are taxed 30 cents per pack, compared to $5.85 in New York City — could net a smuggler more than $40,000 in profit when the goods are resold in the city. All for a few relatively low-risk hours along I-95.

    Smuggled, untaxed cigarettes are everywhere in New York City