INFORMATION PRIVACy

Privacy-Focused Technology

Almost all core technology used in the development and use of the Silk Road has privacy as one of the fundamental features. Tor, originally developed by the U.S. Military to protect U.S. intelligence communications, was used to access the Silk Road. Tor has two fundamental properties: The user’s ISP (internet service provider) will not be able to track your internet activity, including the names and addresses of the websites you visit, and the operators of the websites and services you use will see a connection from the Tor network instead of your actual IP address. These properties enable users to browse the internet, exchange information, and express their opinion while retaining their information privacy.

Bitcoin, developed with the purpose of enabling anonymous peer-to-peer financial transactions, was used as a form of payment on the silk road. Bitcoin utilizes a decentralized network of miners/validators, each with its own ledger, to secure the network/facilitate the transfer of Bitcoin. Bitcoin, and other cryptocurrencies, enable users to send money and buy products, without the need for a third party, such as a bank, which likely requires your personal identification. [4]

There is one scenario that one person first legally use their balance for a transaction, then use the same money again by directly accepting the transaction using an actor miner with having majority of computation power online, called double-spend attack. [1] To prevent this, a limitation called difficulty is imposed so that about 2016 blocks are mined each two weeks.

Mining Difficulty

To validate a transaction, the miner needs to find out a new block, and the difficulty specifies that the miner need to find a new hash below specified target value, which is a type of Proof of Work. When difficulty is 1, the target is 0xFFFF0000000000000000000000000000000000000000000000000000, and the target at given difficulty is obtained by dividing this hex by difficulty. The difficulty would adjust each two weeks according to current mining speed so that approximately 2016 blocks are digged every 2 week, and this long time is used to prevent some short-time fluctuations.

Abuse of Privacy-Focused Technology

Due to the privacy-focused nature of Bitcoin and Tor, both were utilized in the development and use of the Silk Road. While this may give Bitcoin and Tor a bad reputation, due to their fundamental role in the Silk Road, they often enable users to speak and act freely, without the fear of government censorship or retaliation. Even users actively engaging on the Silk Road forums were described as “a better community than I’ve ever seen in real life” (Deep Web, Silk Road Vendor).

Even though privacy-enabling services are likely to be abused, people have a fundamental right to privacy. This fundamental right goes all the way back to the third amendment to the U.S. Constitution, stating “No Soldier shall, in time of peace be quartered in any house, without the consent of the Owner, nor in time of war, but in a manner to be prescribed by law,” [4] and has since been reinforced in multiple court cases.

References

[1] Antonopoulos, Andreas M. Mastering Bitcoin: Programming the Open Blockchain. Second edition, O’Reilly, 2017.

[2] Tor Project, Tor Project History (Tor Project), https://www.torproject.org/about/history/ (Oct 7, 2021)

[3] Satoshi Nakamoto, Bitcoin: A Peer-to-Peer Electronic Cash System (Bitcoin, Oct 31, 2008), https://bitcoin.org/bitcoin.pdf (Oct 10, 2021)

[4] Third Amendment, Constitution of the United States, https://constitution.congress.gov/constitution/amendment-3/ (Oct 8, 2021)

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