"Being a vendor online is just like owning or managing a business—the only difference being that the government decided that what we do is illegal."
Image: Anthony Ryan / CC
Many fans of Bitcoin would like to distance the technology from the reputation it has gained as the currency of choice for drug dealers and criminals on the internet. But to ignore the cryptocurrency's use in illicit markets is to miss a vital part of what has made it successful. Food trucks and floundering satellite television companies accepting digital cash is nice, but if you want to see where the real action is in this new economy, you need to enter the deep web.
Of course, I had heard about these sites for a long time, but it was still shocking to see what was on offer on my computer screen: row after row of listings for heroin, meth, MDMA, weed, coke, and any other drug you could want. It was Amazon for drugs, all priced in Bitcoin, all available for convenient vacuum sealed delivery to the mailing address of your choice.
Much like other e-commerce sites, every vendor on the site had a username and rating to help customers know which of these strangers selling potent narcotics over the internet had a track record of trustworthiness. One name in particular stood out, a vendor who had hundreds of completed sales with a nearly flawless feedback rating.
I sent a simple message identifying myself as a journalist and asking if he or she would be interested in an interview. To my surprise, a quick response appeared in my inbox: he or she would be happy to chat. The only stipulations were that we use PGP encrypted messaging and that I did not include his or her actual username in my article. The dealer chose the handle "RainDuck" for our interview.
Over the next week we exchanged messages about being a vendor on the dark web site Evolution, integrity on the black market, what it's like to run a business that's dependent on the Bitcoin network, and the war on drugs—at a time when that war is shifting to the web.
It's not easy to estimate the amount of drugs sold online, but estimates by the United Nations and others say the market is multiplying in size. To stop the internet trade, the UN says that postal inspectors, customs agents, and "other agencies" are "vital to ensure that points in the supply chain could be more effectively cut off and make it more difficult for buyers to obtain products."
A number of questions to RainDuck went nowhere: when I asked for RainDuck's age, he apologized. "I'm sorry but I can't give even an approximate answer to that question. I'm old enough that I can do this safely, but not old enough to die of natural causes. That's the best answer I can give, somewhere between 25 and 90."
Motherboard: Why did you become a vendor?
RainDuck: I became a vendor after quite a bit of experience starting as a buyer. When I discovered the darknet markets, I saw an opportunity to avoid the shadyness that comes with buying drugs from a friend of a friend of that one guy that I met at a bar. I could buy drugs from someone after reading dozens of reviews on their service and product, and feel confident that I was getting what I was paying for.
Unfortunately vendors online can rip people off just as drug dealers in person can. There is a degree of safety, but some vendors follow a pattern of providing legitimate service for a short period of time before ripping a bunch of people off and running away with the money.
I saw an opportunity to provide a legitimate service to my customers. I became a vendor and made it a point to prove that I am honest and trustworthy. I made a name for myself and became known as the type of person who you could trust. I've had many opportunities to rip people off without repercussions, but I've never once scammed someone. Reputation is everything on the darknet markets, and establishing myself as a trustworthy individual has been far more profitable for me than being a con artist. To summarize, I saw an opportunity to provide a degree of service that is uncommon in the world of drugs, and decided to fill that void.
Were you involved in this industry before your current account? And if so, how long have you been in the business?
I have indeed been involved prior to my current account. Unfortunately I can't go into specifics. Staying anonymous is the most important factor to any vendor who values his/her freedom, and being in the spotlight is not always a good thing. When someone has too much attention drawn to them it's sometimes best to step back and lay low for awhile, and that applies to the internet just as much as to drug dealers in real life.
You are currently using a centralized marketplace. What are your thoughts on decentralized marketplaces (i.e. the Dark Market project) and what they mean for the future of online commerce?
Good question. To those who don't know, centralized marketplaces hold all of the money for you. Tens of thousands of buyers and vendors will trust the marketplace to hold their money in escrow, and they release the funds from the buyer to the seller when both users confirm that the transaction has been complete.
The downside to this model is that the amount of money the marketplaces hold at a time can reach hundreds of millions of dollars, and it's held by someone who has the opportunity to run away with the money at any time. In the last year there have been several marketplaces that have run away with a total of well over a billion dollars. Many people's lives have been ruined by money loss, and the community as a whole is very distrustful of this business model after several recent scams.
In the long run, I believe that we will move almost entirely to using decentralized markets.
Decentralized marketplaces limit their own power, and rather than keeping the money in their own account, they essentially hold "keys" to the accounts that the money is held in. Two people must use their keys in order to unlock the funds from escrow, whether those two people are the buyer and vendor, or the buyer and the marketplace, or the vendor and the marketplace. This allows the marketplace the ability to resolve issues without giving them the freedom to run off with large sums of money.
The downside to this model is that from a technical side it can be very hard to use. So far most of the decentralized marketplaces require some degree of programming knowledge, or external software, or otherwise are too complicated for the average user. For that reason most of the decentralized marketplaces attract less traffic. In the long run, I believe that we will move almost entirely to using decentralized markets, but it may be another year or two before the sites are streamlined to allow both the buyers and the vendors to use this kind of marketplace easily.
What is your average revenue and profit in a month?
Unfortunately that's not a question I feel comfortable answering. I can say that there is a very large amount of money that can be made in this industry,and I make more than enough.
Being a vendor online is just like owning or managing a business—the only difference being that the government decided that what we do is illegal.
Did you have prior business experience before coming to this industry?
I did. Most people don't consider selling drugs to be a business, but the successful vendors treat it just like any other business. It's important to have good time management skills, accounting skills, as well as customer service skills. Being a vendor online is just like owning or managing a business—the only difference being that the government decided that what we do is illegal.
What do you think is the biggest misconception about dark net markets?
I think there are two equally large but opposing misconceptions. Some people believe that using darknet markets as a buyer is extremely dangerous and they don't feel comfortable doing so because they think if a few grams of weed is sent to them that they will undoubtedly go to jail. Others are too confident in the safety of the markets, and they will openly talk about sensitive information that could easily lead to their arrest.
The reality is somewhere in the middle. For security reasons most marketplaces require buyers to encrypt their addresses using special software that only allows a specific person to read it. However there are a shocking number of people who don't encrypt sensitive info and openly admit online to crimes that could easily lead to their arrest if the information were in the wrong hands.
At the same time, law enforcement for the most part is after the large-scale buyers and vendors who are moving large amounts of product. Although if given the opportunity they may try to arrest someone buying a small amount of weed, the truth is that the level of caution needed for someone interested in buying a quarter ounce of weed is completely different than the amount of paranoia and protection needed for someone buying thousands of dollars of product on a regular basis.
Use common sense and protect yourself, but realize that there are a plethora of people who use these sites on a regular basis, and 99.99% of the people who do so will never encounter any problems doing so. The system is designed to be relatively safe for the buyers, and in most cases you're more likely to go to jail for buying drugs in real life than online.
I just want to make sure that they know what's in it, rather than buying cocaine from some random guy that turns out to be laundry detergent.
Do you have any qualms about the fact that you may be supporting the problems of drug addicts?
Initially yes, though after becoming more involved in this community I look at things differently. Even among the "hard drugs" such as meth and heroin, many of the people who do it are not bad people, and not all of them are addicted. Most people only see the stereotypes. The truth is that while there are people who have used drugs and became addicted to them and had their lives ruined, a surprising number of the people who use drugs regularly you would never know. I regularly get messages from people who confide in me that although they are a successful businessperson, there's not a single person who knows about their drug use because it's not socially acceptable.
Prohibition has never worked. It didn't work with alcohol and it doesn't work with drugs. People should make their own choices. I'm not here to judge people for what they do, I just want to make sure that if they make that choice, they get it safely, at a fair price, and that they know what's in it rather than buying cocaine from some random guy that turns out to be laundry detergent. There's no doubt that drugs can be dangerous, but sometimes the lengths that people are forced to go through to get their drugs are more dangerous than the drugs themselves.
Do you use your own products?
I do occasionally, though I don't use all of the drugs that I sell. I don't mix business with pleasure, and I don't have the time to do so often even if I wanted to. My use of my products is mainly limited to testing them and making sure they are safe before sending them off to my customers.
Drug legalization is slowly gaining traction among policy experts. Do you think, twenty years from now, this industry won't be relegated to the lesser traveled corners of the internet?
Yes and no. There is increasing pressure to legalize drugs, but unfortunately most of that focus is strictly on marijuana, and that's at the state level more than the federal level. It's impossible to say what will happen 20 years from now, but there are too many people who profit off of the fact that drugs are illegal. Prisons, police officers, tobacco companies, and alcohol companies all would lose an unbelievable amount of funding if drugs were legalized.
It's sad to think that the majority of people in jail right now are there for possession or sale of small amounts of drugs, but unfortunately it's a cat and mouse game that take an insane amount of money from taxpayers and puts it in the pockets of the corporations that stand to benefit from the way the laws are structured now.
Only time will tell what will happen, but I doubt that 5, or 10, or even 20 years from now people will be openly doing cocaine, meth, shrooms, heroin, or acid, though I do think that weed has a much larger chance of being completely legalized due to the fact that it's more socially acceptable.
You say that there are "too many people who profit off of the fact that drugs are illegal" for anyone to expect widespread legalization anytime soon. Do you think that's the central motivation for the "War on Drugs"? Or is it more about protecting the public?
I think that point of view is very accurate. A lot of people seem to look at it as a conspiracy, but I don't necessarily think that's the case. Rather, it's the people who profit off prohibition who spend very large sums of money to lobby politicians in Washington. It would be naive to think that's not the case. Polls shows that the public is largely in favor of legalization (of certain drugs at least) and yet no one at the political level seems to be in any rush to make things happen.
At the very least, drug use should be legalized. If they want to keep throwing us dealers in jail that's one thing, but the fact that 98% of drug related arrests involve simple possession is ridiculous, and it's not okay that millions of people's lives are being ruined when most of them simply were caught in the wrong place at the wrong time, and for doing something that would be completely okay if they lived in certain states (Such as California and Colorado).
This answer refers mainly to marijuana of course, but again the point remains. There are almost as many people who smoke marijuana as there are who drink alcohol, and weed kills significantly less people. If we are still putting people in jail for possession of a much safer substance than alcohol, I wouldn't count on heroin being legalized anytime soon.
You have to worry about law enforcement in your business. Have there been any close calls?
I can say that if I had what I would consider to be a close call I would get out of the business completely, but that doesn't mean I feel completely safe either. In this business it's always better to be too paranoid than not paranoid enough.
Knowing that I'm helping to safely provide medication for someone who otherwise wouldn't have the ability to get it is more rewarding than anything else. That said, the money isn't bad either.
How do you deal with, what I would imagine to be, the constant stress from this paranoia?
Unfortunately I haven't figured that part out yet. My business keeps me busy most of the time, and unlike traditional jobs I don't get vacation days or time off. I'm too busy to focus on the constant stress I endure, and although that may sound pessimistic to some degree, I'm overall very happy with my life. I love what I do and knowing I'm providing a service that not many people can offer.
Mainly it's the people who purchase drugs not recreationally but for medicinal purposes that makes it all worth it. I regularly have people confide in me that my products are the only thing that has relieved their pain, and many of my customers are old enough that they don't have the ability to buy from a friend of a friend. Knowing that I'm helping to safely provide medication for someone who otherwise wouldn't have the ability to get it is more rewarding than anything else. That said, the money isn't bad either.
Would you consider vending online to be a safer option than vending in person?
For the vendors, dealing in person would be safer. For the buyers, the reverse is true. Law enforcement mainly targets the vendors, and most buyers have nothing to worry about unless they are ordering very large amounts of product. There have been reports of buyers being questioned after failing to take the proper steps to protect themselves, but buying online is generally much safer than buying in person for most circumstances.
For a vendor, all it takes is one message that is accidently left unencrypted, one fingerprint left on the inside of a package, or one strand of hair.
If dealing in person is safer, then why do you choose to vend online?
Overall dealing in person is safer, but it depends what you are selling, who you are selling to, and how much. If you know what you're doing, vending online has the potential to be safer than dealing in person, but the risk lies not in what you are doing, but the mistakes you make. For a vendor, all it takes is one message that is accidently left unencrypted, one fingerprint left on the inside of a package, or one strand of hair that could potentially lead to their arrest if in the wrong hands.
A vendor that knows what they are doing can be perfectly safe, but unfortunately there's no college course for being an internet drug dealer. The only way to learn is to try it, but unfortunately this is one industry where making mistakes while learning is not okay. Essentially I choose to vend online because I feel I have the knowledge and ability to do so safely. For the majority of people who take the same path however, they are playing Russian roulette and they will either make very little money, quit shortly after, or law enforcement will just wait for them to make a mistake.
Do you run a solo operation or are there employees?
Sorry but I can't answer that.
When business is good bitcoin volatility isn't an issue, but when business is slow, a drop in the value of bitcoin can be the difference between making a profit and breaking even or even losing money.
How does Bitcoin's volatility affect your business?
When business is good bitcoin volatility isn't an issue, but when business is slow, a drop in the value of bitcoin can be the difference between making a profit and breaking even or even losing money.
Bitcoin can definitely play a huge role in the amount of income vendors make, especially for newer vendors. Vendors that have not earned trust in the community are almost always required by the marketplaces to use their escrow system. On average it can take about a week between the time the package is sent and the time the money is released from escrow, but in some cases if there are problems with an order it can take 3 weeks or more.
In addition, the vendors have to find a way to safely and anonymously convert bitcoin into actual currency, which can take even longer. Considering that bitcoin can stay around the same rate for weeks and then suddenly increase or decrease by hundreds of dollars in a matter of days, newer vendors may find themselves gambling with their profits.
Many vendors who are more established can get away with requiring the funds to be released from escrow before sending packages. Even then it can be several days from the point the order is placed to where the vendor has the money physically in their possession, but it tends to average out over time. If a vendor does a lot of business consistently over time, they can accept short term losses from drops in bitcoin, knowing that at some point they will make more money if bitcoin goes up in the future.
How do you cash out your bitcoins?
Again, answering that question would be a security violation. I take very great lengths to make sure that I cash out my bitcoins safely, but elaborating on exactly what I do is not something I'm willing to share.
There are plenty of people who purchase from the darknet markets and resell the product wholesale, taking advantage of the cheap prices of Chinese-made drugs specifically.
Among people in the "real world" of drug dealing, is Bitcoin gaining a name for itself?
Not at all. The majority of "real world" drug dealers have no idea what Bitcoin is or even that this community exists. Of those who do, they certainly won't share that information with others. There is a huge opportunity for drug dealers to make a very large amount of money reselling the right products, but no one wants anyone else to know that. There are plenty of people who purchase from the darknet markets and resell the product wholesale, taking advantage of the cheap prices of Chinese-made drugs specifically, but it's a very small percentage of dealers who do so.
Darkmarket sellers were some of the first in the world to rely heavily on the Bitcoin network for their trade. Considering this wealth of experience, do you think Bitcoin has a legitimate chance at becoming a widely used method of payment for transactions beyond the black market? Or do you think of it as mainly useful for what you do today and nothing else?
I think Bitcoin has the potential to become a widely used method of payment in general. Unfortunately until recently it's been very unstable, and few legitimate businesses want to take the chance of accepting a payment method that may be worth 20 percent less a few days from now. Most businesses that accept bitcoin are owned by people who believe in the long-term potential of bitcoin, but currently the number of businesses who do so are few and far between. That said, there are a small number of very large businesses who have recently stated their intentions to accept bitcoin, and I believe that will encourage other smaller businesses to do the same.
Right now the bitcoin community is divided mainly among those who use it as an investment and those who use it for illicit purposes. Fortunately it seems that recently there are efforts by bitcoin investors to use it for more legitimate purposes, and we are seeing an exponential number of businesses offering services such as hotel rooms and flight, as well as retailers offering electronics, furniture, and other commodities. It's too early to tell exactly how this will play out, but there are enough people who believe strongly in the long term future of bitcoin that I truly believe we will see much more widespread use of it for legitimate purposes. Bitcoin certainly isn't going away anytime soon.
Do you plan on being in this business for a long time?
I do. I've done quite a bit in my life, but nothing has been as satisfying as being a vendor. It's stressful, dangerous, and time consuming, but the rewards are great.
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