the internet and the sale of illegal drugs, analysis of...
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The internet and the sale of illegal drugs, analysis of the situation, challenges and
approaches
Jane Mounteney PhDEMCDDA2nd COPOLAD ANNUAL CONFERENCE, Buenos Aires 16-17 May 2017
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I plan to address…
• Drug markets online• Surface and deep web• Illicit drug sales, patterns
and trends• What is the future for
IDM?• Challenges and
opportunities
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Why internet markets are important?
• A new and rapidly developing phenomenon
• Global in reach and implications• Drug supply chain - effects all
levels and aspects• Source for very potent
substances• Observable market activity• More open to monitoring and
study
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EMCDDA 2006 - first toe in the water
• Internet snapshots• Online sale of ‘legal
highs’• Multi-lingual, new
methodology• Legal highs, mushrooms,
GHB/GBL• Snapshots and EWS risk
assessments• Internet markets study
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My sources
Drugs and New Technologies Issue 6, March 2016Author: Van Buskirk, J., Naicker, S., Bruno, R., Burns, L., Breen, C. & Roxburgh, A.
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2011: Heroin shortages in Europe2012: Fentanyl outbreaks in Europe2013: Methamphetamine: availability, use and harms2014: Internet and drug markets2015: MDMA market changes2016: NPS and problem drug use
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Trendspotting in a nutshell
•Rapid information assessment•On new trends, concerns, uncertainty, ‘hot’ issues• Complement to routine methods• Triangulates hard and soft •data sources (expert opinion, intelligence etc)
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Drug markets study objectives…
To increase understanding of the online supply of drugs and map the range of internet drug markets in existence. Focus on
• The role of social media and apps• Online sale of NPS• Online sales of medicinal products for
illicit use• Sale of drugs on the deep web
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WS 5 TechnicalFolders
WS1 Forums
WS2 Online Shops
WS3 Online Survey
WS4 Chemical analysis
Study experts
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Surface webMainly NPS and counterfeit
medicines online pharmacies, LH shops, social
media,
Deep web Cryptomarkets (anonymity,
encryption, bitcoin) e.g. Agora, Silk Road
Mainly established drugs Currently low level, but…
A range of online markets…
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Deep web
Dark net
Cryptomarkets
Surface web
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13© N. Christin Drug supply on the darknet: EU-focused analysis
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Dark net markets, cryptomarkets
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Combination of technologies:
Bitcoin – payment anonymity
Encryption
Tor – communication anonymity between buyer and seller
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You
Middle Relay
Middle Relay
Rendezvous Point
Middle Relay
Middle Relay
site.onion
How does Tor work?
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Rating systems
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Cryptomarkets rely heavily on trust. Rating systems provide buyers with a fairly reliable track record of a vendor’s previous transactions
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Which drugs are sold? Breakdown by volume
19N. Christin 2017. Drug supply on the darknet: EU-focused analysis
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Comparison w/ non-EU sales
Drug sales Total salesVolume(g) Revenue(€) Revenue(€)
European Union 5,523,695 79,012,948 86,126,606Rest of the world 10,877,448 93,332,764 115,736,370Total 16,401,144 172,345,712 201,862,977
© N. Christin Drug supply on the darknet: EU-focused analysis 20
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What is the size of the online market?
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Currently small but growing drug marketYearly sales estimates from $15 million in SR in 2012 (Christin, 2013) to $ 90 million in 2013 (Aldridge; Décary-Hetu, 2014)
Number of active retailers on the Black Market Reloaded, Sheep Market and Silk Road 2.0 (Van Buskirk et al, 2013)
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Safety
Why sell online? Top reasons on Silk Road
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Site’s anonymityEconomically viable and secureLow riskCircumvention of national legislative controls
Simplicity of vendingHigh traffic volume
Higher mark-up‘Educated’ and wealthy consumer6
Variety of distinctive products
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Why buy online? Top reasons on Silk Road
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Better qualityPoor quality in localityHigh rating sellersVendor feedback ratingsMember forum informationHarm reduction
Wider range of drugs availableSpeedy deliveryConvenient to order online
Access /availability
Safety
Site’s anonymityPersonal safety vs buying on the streets
Quality Why not?
BitcoinsRipped off
PricesEffort
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Global or national?
Many buyers prefer sellers from their home country, less risk with fewer borders to cross.
A new Finnish marketplace established on deep web after Silk Road closed
Most US and Australian vendors not willing to ship drugs across international borders,
Australian buyers prefer local sellers.
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Ease of access
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Soska & Christin, USENIX Security 2015 28
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New Psychoactive Substances
N. Christin. Drug supply on the darknet: EU-focused analysis 29
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IDM trends – complex and unstable
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Tor TriblerI2P GNUNet
Freenet OneSwarm
Gigatribes
ZeroNet
RetroShare
Syndie
Many types of darknet:Onion, block chain, distributed…
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Recent trends
Increased uncertainty in the deep web community as a result of police interventions and vendor scams.
A tendency towards decentralisation of market structures (e.g. shared hosting)
Mechanisms developed to regain buyers’ trust
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Additional security mechanisms
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Escrow (multi key)Reputation and rating systemsBitcoin fogAdjudication ContractsStealth packagingInvite onlyShared hosting, distributed architecture
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What is the future for IDM?
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E-commerce - fastest growing retail market in Europe and US
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But market share comparatively low in most European countries – 9% av
Centre for retail research [email protected]
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Proliferation of mobile shopping app’s
M-commerce also on the rise
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Would be a surprise if D-commerce did not follow suit
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Perhaps just a question as to what form it will take
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Drivers of change – online markets
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• Technology, globalisation and market innovation
• Digital literacy increasing and expanding pool of potential market users.
• Dark net markets – security issues, encryption, digital currencies, anonymous browsing
• Marketing innovations, e.g. deep web search engine GRAMS.
• Cat and mouse game
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IDM trends – delivery mechanisms
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Small packages and anonymous post boxes
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Temporary slow down in overall activity on dark net marketplaces?
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Consumers moving to private arrangements with retailers, to avoid the risks
Query – will DNM return to the trend of steady increases in retailer numbers previously observed, or instability continue to typify the operation of darknet markets?
Drugs and New Technologies Issue 6, March 2016Author: Van Buskirk, et al
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The internet is only really at the beginning of its beginning. Kevin Kelly (Linked in & Wired)
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The current weakness in all of these markets is the single-server model. A fully distributed cryptomarket increases the difficulty and economic costs of removing such markets from the internet (Loman).
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Market security v accessibility conundrum
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Open drug scenes
Closed mobile networks
Open cryptomarkets
Closed peer to peer deals
?
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Health applications and approaches
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Evidence-based online prevention, harm reduction and treatment services
Evaluation of online interventions, law enforcement and health.
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Law enforcement approaches
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Gaps and issues…
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Medicines - the role of online pharmacies - specific EU studies desirable
Role of social media and apps in the demand for and supply of illicit substances
Consumer-level research focusing on sources of drug supply, reasons for choices, experiences.
Testing drugs sold online – linked with sampling strategy
Importance of data triangulation – an area with partial information
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Research questions
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What is the market size (surface and DNM)?What trends can be observed? Product, price, purity etcDo online markets challenge established ones - where do they have a competitive advantage?Supply chain - how do online markets interact with offline ones?What are the net harms/benefits of dark net markets?Do individuals who sell on dark net markets fit the same profile as street dealers? Do people purchase more when they buy online and what effect does that have on use?
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Trendspotting and internet drug markets….?
Tor and links with cryptomarketsAndrew Lewman
How the use of the internet is affecting drug trafficking practicesAnita Lavorgna
The drug trade on the deep web: a law enforcement perspectiveJoost van Slobbe
The emergence of deep web marketplaces: a health perspectiveFernando Caudevilla
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Thank you!
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