1. The Silk Road: An Online Marketplace
By Adam Cronin

2. Project Overview
Main goal: Research The Silk Road and how it provides anonymity
Mechanisms for providing anonymity
Failures in anonymity

3. What is The Silk Road?
An anonymous online marketplace created to facilitate the online sales of both legal and illegal items
People around the world can trade with each other without divulging their identity
A means of circumventing buying and selling restrictions that may be in effect due to geographic location

4. Anonymity in a Marketplace
Requirements for an anonymous online marketplace
Accessing the site
Ability to post/advertise items for sale
Ability to browse available items
Transactions
Sending item from seller to buyer

5. The Silk Road’s Solution
Requirements for an anonymous online marketplace
Accessing the site  Tor
Ability to post/advertise items for sale  Register Account
Ability to browse available items  Register Account
Transactions  Bitcoin
Sending item from seller to buyer  Still have to give an address…

6. Tor
The Tor browser is essentially a means of anonymously sending network data
Data is sent through a series of nodes
Each node is a volunteer
Each node only knows the previous node and the next node so single compromised node isn’t a huge issue

7. How Tor Works Tor installs an Onion Proxy onto the user’s computer
The OP creates a virtual circuit that defines the path through the Tor nodes that leads to the user’s end destination
Tor downloads list of all potential Tor nodes in the network
Uses the list to choose an Entry node, an Intermediate node, and an Exit node

8. How Tor Works (Cont’d)
Creates a Transport Layer Security (TLS) connection between itself and the Entry Node
Uses encryption to prevent eavesdropping, tampering, or message forgery
Then starts the process of creating the virtual circuit
To create a VC, can send three commands: create, extend, and delete

9. Tor
Destination Server
Onion Proxy

10. Create TLS Connection (Transport Layer Security) Destination Server
Onion Proxy
TLS, K1

11. Create Command on Entry Node
Destination Server
Onion Proxy

12. Create Command on Intermediate Node
Destination Server
Onion Proxy
Extend

13. Create Command on Exit Node
Extend
Destination Server
Onion Proxy
Create

14. Send Message
Extend
Destination Server
Onion Proxy
Create

15. Traditional Online Transactions
Traditional online transaction requires a middle man
Buyer  Bank  Seller
Disadvantages of trusted third-party
Access to user’s money
Knowledge of all transactions and who with
Transactions can be disputed and reversed

16. Bitcoin A peer-to-peer electronic cash system
Goal: move away from the traditional form of cash exchange
Remove trusted third-party (ex: banks)
Instead of third-party, broadcast every transaction to all nodes on the Bitcoin network
Transactions can’t be reversed or disputed

17. Bitcoin
Each user holds their Bitcoins in a wallet which is referenced during transactions
Bitcoin characterized as a “chain of digital signatures”
Each user has a public and private key so that only the owner of a wallet can transfer Bitcoins
During a transaction, a signature is created and added to the coin
Private key used to generate signature
Public key used to verify the signature

18. Failures in Anonymity
Tor by itself doesn’t encrypt data leaving the exit node or returning to the exit node
A passive attacker who watches both the sender and the receiver could link the two with high probability
Compromised TLS key for Onion Proxy could lead to impersonation
Receiver of package must still give an address

19. Failures in Anonymity
The Silk Road has been shut down twice and the people running the site were arrested
A new clone is started up every time The Silk Road gets shut down

20. References
[1] Christin, Nicolas. "Traveling the Silk Road: A Measurement Analysis of a Large Anonymous Online Marketplace." (2012): n. pag. Carnegie Mellon, 30 July Web. 12 Oct <
[2] Dingledine, Roger, Nick Mathewson, and Paul Syverson. "Tor: The Second-Generation Onion Router." (n.d.): n. pag. Web. 5 Oct <
[3] Dierks, T. & C. Allen. “The TLS Protocol Version 1.0.” January (6 November 2015)
[4] Nakamoto, Satoshi. "Bitcoin: A Peer-to-Peer Electronic Cash System." (n.d.): n. pag. Web. 5 Oct <
[5] Biryukov, Alex, and Ivan Pustogarov. "Bitcoin over Tor Isn't a Good Idea." 2015 IEEE Symposium on Security and Privacy (2015): n. pag. 8 Jan Web.