Untraceable money

From today’s Wired Magazine: Amir Taaki and his collaborators recently unveiled a prototype for a decentralized online marketplace, known as DarkMarket, that’s designed to be impervious to shutdown by the feds.images-1

The programming provocation they released a few hours ago is called Dark Wallet, a piece of software designed to allow untraceable, anonymous online payments using the cryptocurrency bitcoin. Taaki and Wilson see in bitcoin’s stateless transactions the potential for a new economy that fulfills the crypto-anarchist dream of truly uncontrollable money. They envision a digital payment network that circumvents every authority’s attempts to tax it, seize it, censor it, track it, or imprison those who would use it to trade in contraband like weapons, drugs, and even abhorrent services like murder-for-hire and child pornography.

And yet for all that, Dark Wallet isn’t necessarily illegal. Taaki and Wilson, who spent two years in law school before dropping out to pursue his anarchist dreams, argue their creation is just a piece of code and thus protected by free speech laws. Then again, Wilson also has described it publicly as “money-laundering software.” The evening before, he received an unhappy email from his lawyer friend, cautioning him about expressing criminal intent in an interview with me that was published two days earlier. Wilson’s half of the ensuing phone conversation went like this: “How can we cower now? We’re the people who do things and tell them to put up or shut up … [pause] … I guess you’d rather I go back to running guns? … [pause] … OK, I’ll talk to you later.”

Hence the unplanned road trip. The drive through the empty Texas landscape gives me a chance to ask the looming question: How will the world change if Taaki and Wilson succeed in their quest to make money truly anonymous? “There’s going to be a bit of a shake-up,” says Taaki, who speaks with a British accent that borders on cockney. “No one knows how it’s going to turn out.”

He pauses. “The assassination markets are going to be a bit shit.” Untraceable murder-for-hire, in other words, could be an unfortunate side effect of their financial innovation.

Then he seems to regain his resolve. “I believe in the hacker ethic. Empower the small guy, privacy and anonymity, mistrust authority, promote decentralized alternatives, freedom of information,” he says. “These are good principles. The individual against power.”

Warming to his subject, Taaki raises his voice as if he’s speaking to a crowd larger than the three of us here in the car. “But it’s important to be clear that it may not be good on balance, either,” he says. “The world is not perfect. Good and evil rise together.”

Wilson cuts in from the driver’s seat, shifting into agitprop mode. “It’s time for a good old-fashioned pendulum swing,” he says. “Where the people fear the government there’s tyranny. Where the government fears the people there’s liberty. They’re afraid, therefore it’s good.”

But Taaki seems willing to contemplate a more uncertain outcome of the anarchy he and Wilson seek to create.

“It will be different, more diverse,” he muses, as if imagining this new reality for the first time. “We’ll step out into a new world, and we can explore it in any direction we choose.”

The 21st century has already seen its first experiment in crypto-anarchy: the billion-dollar, anonymous online drug marketplace known as Silk Road. In October 2013, the FBI seized the well-hidden server that hosted the site on the anonymity network Tor. The agency also arrested its alleged founder, 29-year-old Ross Ulbricht, calling his work a vast narcotics and money-laundering conspiracy.

Cody Wilson would call it a mere proof of concept.

In a packed bar on East London’s Brick Lane two months after the Silk Road crackdown, Wilson stood onstage—inexplicably wearing a single leather glove—and scolded the audience of the London Bitcoin Expo: “Ross Ulbricht is alleged to be the founder and operator of Silk Road, the glittering jewel of all things libertarian, black market, and wonderful. And it’s a severe indictment of the modern libertarian conscience that he can’t get any support at all.” (At the time, just $3,800 dollars had been donated to the fund-raising site created by Ulbricht’s family, FreeRoss.org, well short of their $50,000 goal. That lukewarm response likely had much to do with prosecutors’ claims that Ulbricht had paid hundreds of thousands of dollars worth of bitcoins to contacts he believed were hit men who would kill his enemies, including a blackmailer and a potential informant.)

More at: http://www.wired.com/2014/07/inside-dark-wallet/

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