Social-Final_TheDarkNet

Copyright Kurt Callaway, 2014
Whither the Dark Net?
Final Essay
Kurt Callaway, FORE 6331
4 Dec 14
On November 6 2014, news sources reported that a major online illegal drug market named Silk Road 2.0
had been closed down by US law enforcement officers, with help from officials in other agencies and from
other countries (Williams, 7 Nov 2014, para. 1). This event put a spotlight on a little-known and poorly-
understood subset of the Internet called the “darknet” where Silk Road conducted its business. Yet as
ominous as that name sounds, its origin, growth and persistence is an understandable and indeed inevitable
development and extension of society’s increasing embrace of the digital age. An examination of the
characteristics and history of the darknet using selected theories of social change can help us understand
the phenomenon and might offer some basis for believing the darknet will continue to grow in scope and
importance.
As a technology-heavy topic, the ‘darknet’ requires an introduction. For the purpose of this essay, the
darknet is that part of the Internet not accessible by normal search and addressing protocols and methods
(unlike the World Wide Web), and requiring access through specialty software that provides a strong
assurance of security and anonymity (unlike many early peer-to-peer networks). The TOR project is one
popular type of software, though it is not the only one. Computer systems using TOR form a network that
“guarantees encryption and anonymity between users” (Chacos, 12 Aug 2013, para. 5).
The ability to avoid tracking of one’s movements and actions online can serve many purposes, but the
aspect of the darknet which seems to be covered most frequently in the news media is that of marketplace
for illegal goods. The headline for a Wired article in 2014 says it all: that a new development in the
darknet will make “buying dope and guns easy” (Zetter). The illicit marketplace has been targeted by law
enforcement officers multiple times, but seems to return more strongly after each major raid. What can we
say about this phenomenon in terms of social theory? Let us Adam Smith’s ideas to these darknet markets
(DNMs).
Writing in the late 18th
Century, Smith wrote on a variety of social structure topics, but not all of these are
relevant to the current events. Of perhaps the greatest import is the concept of individual action; that is,
“on the whole, individuals tend to pursue their own self-interest without much sense of a larger plan”
(Noble, p. 20). They take action generally not for another’s benefit, but usually for their own advantage.
Smith continues on to say that people of similar interest or stature (class) will tend to act in the same way,
but merely because their individual interests align so well with each others’ (Noble, p. 21). People, Smith
believed, are moral creatures, sensitive to the judgment of others about their behavior, yet as Noble clearly
points out, not everyone is able to resist the temptation of setting aside their scruples when they “conflict
with an opportunity for personal advantage” (p. 22). Smith also identified the emergence of a division of
labor from humans’ natural “propensity to truck, barter and exchange one thing for another” (Noble, p.
23). That there are influential elements beyond the market and its participants itself was also a part of
Smith’s structural view. He also took into account the power of the state, “since the distribution of power
is the critical factor in fostering and obstructing growth” (Noble, p. 29).
This summary of Smith’s theory helps explain many aspect of the market sector of the darknet.
Fundamentally of course, the very existence of the DNMs are an expression of the desire to satisfy that
human need to barter and trade, to meet the need to balance production and demand. That much, if not
most, of the goods for sale on the DNMs seem to be illegal or harmful to the buyer – or to those around
the buyer – is only a reflection of the seller’s pursuit of their own advantage, even if they are fully aware it
is not to another’s benefit. Such unconcern is not universal on the darknet, however. Both the Silk Road
Copyright Kurt Callaway, 2014 1

market site (shut down in 2013) and its successor Silk Road 2.0 (closed down a year later) were run by
administrators with libertarian views (“Amazons of the Dark Net”, para. 5; Greenberg, 14 Nov 14, para.
14). They allowed drug sales (presumably considering it a victimless illegality), but didn’t permit sales of
weapons or stolen credit card data as do many other DNMs. As legally questionable as some of the
activities are, clearly Smith’s moral scruples are a factor, at least with a portion of the darknet’s sellers.
Even Smith’s concept of the “general other” can be seen at play in the darknet, filling the role of preventing
the merchants from succumbing completely to the urge to follow their own advantage. It’s formed by the
mechanism whereby the anonymous (and effectively abstract) buyers on the larger, more trusted DNMs
can review and rate the quality of the product or service, similar to the way Amazon.com out on the open
Internet does it (“Amazons of the Dark Net”, para. 8).
The role of the government in dealing with the DNMs also falls in line with Smith’s theory, although
perhaps in a way different from that he originally envisioned. While Noble implies Smith saw government
as an inhibitor to the growth of commerce, events recently seem to point to the opposite effect in the
darknet. When the largest DNM for illegal drugs, Silk Road, was taken offline by officials in 2013, it was
soon replaced by a large number of other drug DNMs (as well as the follow-on Silk Road 2.0) that greatly
increased the number of products available to buyers. From 18,000 items offered by the original Silk Road
(and other sites), the market increased to around 47,000 listings as of August 2014 – ten months after Silk
Road was shut down (Ingraham, para. 8). This seems hardly in line with Smith’s belief that “. . . restrictive
practices of any kind also interfere with the process of the market” (Noble, p. 27).
A hindrance anticipated by Smith that may also be in play is the free availability of knowledge, “particularly
knowledge about prices, but any information which may be relevant is significant” (Noble, p. 27). The
darknet has always labored under the dearth of knowledge about its structure, products, even its very
accessibility. While determined and technically-minded users can gain access to the darknet by installing
the TOR software and entering an unorthodox and unintuitive web address, navigating around the network
is difficult. A reviewer from PCWorld noted the unreliable signposts in “Onionland” (another name for the
TOR-accessed darknet): “even the major directories aren’t completely reliable . . . with Hidden Services
appearing and vanishing on a daily basis . . . even the directories themselves sometimes shift URLS, and
you have to track down their new location . . .” (Chaco, para. 10). To help address such obstacles to the
otherwise vibrant market forces at work, by mid-2014 the first “Google”-like search engine (called
“Grams”) was launched and since then “has grown rapidly to become the most trusted search engine for
patrons of the anonymous online markets” (Spotz, para. 1).
Another market-oriented aspect that Smith described is that of globalization – or as he labeled it, “foreign
commerce” (Noble, p. 38). Indeed, it seems clear the darknet is far from confined to a single region, let
alone country. The globalization of the darknet’s markets can be seen most readily in the details about the
actions taken by national authorities to shut some of them down. The Silk Road 2.0 raid involved the law
enforcement efforts of the US and sixteen European countries (Williams, 7 Nov 2014, para. 1). Such a
broad scope might seem surprising, unless one additionally considers it in light of Castell’s theory of the
“Network Society”. As described in outline by Huckle, the first two characteristics of such a society are
that it is an (a) informational economy; and (b) it is a global economy (Huckle, paras. 9-10). The first
character is self-evident is that the DNMs are wholly resident in, and made possible by, information
technology, emerging only at the point where physical products must be delivered to their buyers. More
important is the second characteristic: globalization. Like the greater economy, the DNMs take advantage
of the global dynamics of product availability, location of buyers, even the nature of the network that
drives the darknet itself. Wired offers the speculation of security researcher Nicholas Weaver that
remaining darknet markets are now “hosted in Russia, China or similar countries . . .” (Greenberg, para.
11), beyond the jurisdiction of American or European investigators. Certainly, the dark markets can’t be
separated from the rise of the globalized economy as a whole. The Guardian remarked on this point early
in 2014: “the growth of purchasing psychoactive drugs online in recent years reflects the growth of e-

commerce more generally” (Power, para. 7). According to Castell, the line between legal and illegal
becomes blurred when the market is treated as the sole source of ethics (Waterman, p.13), which seems to
be much the case with the DNMs. Their strongly anonymous nature means political and legal direction
tends to have much less effect, beyond what is reflected in the personal views of the respective market
administrators.
While Adam Smith’s theory of structural effects did not see a “necessary law of development all societies
must obey” (Noble, p. 36), his work still conveyed the notion that “social structures are not deliberately
contrived . . . but are . . . unintentional consequences of mundane human activity” (Noble, p. 37). This,
along with Smith’s famous “invisible hand” metaphor, seems to offer a systems perspective for explaining
change and is not dissimilar to a theory formulated by Talbot Parsons and described in some depth by
Noble (pp. 176-187). Although Noble mentions a couple of Parsons’s theories, it is the system theory and
not the action theory that applies best to the darknet topic. Parsons distilled the necessary prerequisites for
a functional and viable system down to four “functional imperatives”: (a) the ability to adapt to the
external environment (and to change caused by it); (b) the ability to attain its goal(s); (c) to integrate its
components; and (d) provide for pattern maintenance (Noble, p. 179). Each of these is fulfilled by a
subsystem of the system (though it is not clear whether Parsons believed the subsystems must be truly
separate and distinct or not). Each subsystem, as they are affected by events without, in turn propagate
changes of some sort to the other subsystems of the system. Parsons further identified the concept of
equilibrium within a system (Noble, p. 183). If a change acts on the system within the system’s capacity to
rebound, then the change is short-term. In contrast is the more serious change beyond the means of the
system to adjust, what Noble calls “structural change”, that can lead to the collapse of the system (p. 183).
Before we apply these properties to the darknet, we must address the issues which Noble considers
weaknesses in Parsons’s theory (Noble, p. 184). First is the question of the system boundary. In light of
Meadow’s perspective that “boundaries are of our own making and that they can and should be
reconsidered for each new discussion, problem, or purpose” (p. 99), for the limited scope of this analysis,
the system will be the commercial darknet hosted and accessible only via the TOR anonymizing network.
Human society as a whole is a super-system, for which both the darknet and the open internet are
subsystems – discrete, but with similar purpose and technology. Another weakness cited for the
functionalist theory is that societies (systems) are considerably more diverse than Parsons may allow for
(Noble, p. 185). The darknet, however, may be an unusual system, in that it does have a core value – one
to which all its users ascribe: total anonymity of transaction, whether they be political activists, peddlers of
dubious goods, or people simply wishing to avoid state censorship and surveillance. While it is true there
are other diverse activities on the darknet, that one integrating dominant goal is compelling enough to the
users that some divisive issues are overlooked. For example, the developers of FreeNet, an anonymous
network roughly comparable in function and intent with TOR, declined to filter out exceptionally
objectionable material, since it would mean compromising the project’s greater “no censorship” goal
(Beckett, para. 19). The third problem noted by Noble was that of “direction of effect (p. 186). This
seems to lend itself to no good generalized approach and will have to be treated on an individual and
subjective basis in this analysis.
What kind of system can model the darknet? The adapting subsystem is easiest to identify. It plays the
role of the darknet’s ‘economy’, providing the means by which the system most interacts with the outside
world and its needs and demands. It is the set of selling websites, information dropboxes, whistleblower
databases, and anonymous blogs, through which material and information is transferred between seller and
buyer – or more broadly, source and recipient. The subsystem responsible for attaining the system’s goals
is that aspect which supports the “economy” and allows it to function as desired. The corresponding part
of the darknet is the underlying TOR project, its people and support structure. Also, allowing the system
to attain its goals is the financial underpinning of crypto-currencies, which are vital for providing a way to
anonymously make payments in the market segment of the darknet. Parsons’s third component is that

which integrates the parts of the system. In the darknet, what draws the myriad pieces together is the
actual anonymized and encrypted TOR network of computer systems scattered around the world,
connecting with other TOR-enabled computers without knowing the identity of a transaction’s initiator or
its ultimate destination. In this subsystem, I also include the parts of the darknet which help “logically”
integrate all the fleeting locations being used; that is, the directories and search engines, with their
programmers and other enablers. The last subsystem is the most abstract: the part providing for system
pattern maintenance, as Parsons describes it (Noble, p. 179). This is the shared condition or ideal
throughout the darknet of anonymity and total privacy (and to a lesser extent, trust) which is good and
useful, whether for transacting business or for avoiding state attempts to curtail access and gather date
about groups or individuals. That this subsystem is more “idea” than actual person or thing is nonetheless
in line with Parsons: Noble describes an example of pattern maintenance as being “the cultural values,
latent in every social institution throughout the system” (p. 180).
The diagram in Figure 1 illustrates this suggested model of the darknet subsystems in terms of Parsons’s
functional imperatives.

Figure 1. Simplified model of darknet markets
Having defined a limited model with these features, it is now possible to explain some of the changes that
are known to have occurred within the darknet. The most notable actions, mentioned at the start of this
essay, were the repeated government shut-downs of prominent market websites. One result of such action
was the proliferation of other new marketplaces soon after (Bartlett, para. 4). Another, a year later, simply
caused a shift of sellers to other smaller existing marketplaces (Greenberg, 7 Nov 14, para. 10). These
movements can be interpreted as relatively simple equilibrium-seeking reactions within the system or
rather, within the adapting subsystem. In contrast, the 2014 shutdown (of Silk Road 2.0) also provoked a
structural change via a resulting modification to the attaining subsystem: interest in replacing the
centralized nature of markets with a decentralized approach that can not be neutralized as easily (O’Neill,
para. 3). An article on Gawker that the underlying network might have been compromised by officials can
be modeled as an external change to the integrating subsystem (the underlying computer network) which
in turn affected the adapting subsystem (reliability of market sites) that then affected the pattern
maintenance (ideals) by creating doubt and mistrust of the system, with that reducing confidence and use
of the attaining subsystem (TOR project) by users (Chen, paras. 15, 22-23).
Another example of a change explainable via this model is that of the appearance of the Google-like search
engine tailored specifically for darknet use. There, change to the adapting subsystem, in the form of “more
and more people . . . using darknet markets” (Searingen, para. 14), drives change in the integrating
subsystem; namely as an improvement in search capability. At the same time, it helps the system maintain
equilibrium, since the new search engine will help users “locate sites that have gone down . . . and re-
launched under new URLS” (Zetter, para. 13), thus mitigating the impact of that disruptive external
change.
Interestingly, while these theories – market-driven and system-driven – can both explain some changes,
that’s not always true. For example, the system model appears to be too limited in scope to explain very
well why Facebook has recently established a presence on the darknet in “a first-of-its-kind move for a
Silicon Valley giant” (Greenberg, 31 Oct 14, para. 2), whereas the market theory has little problem
explaining the event in terms of the Facebook merchants following their own interests by growing their
Integrating component
parts
The encrypted TOR
computer network and
people who support it;
directories; search engines
Adapting to external
environment
The “economy”: websites,
dropboxes, other means by
which material and
information is transferred
System pattern
maintenance
Shared ideals or conditions:
anonymity, privacy, trust
Attaining system goals
The underlying TOR project,
its support structure and
people; financial basis
(crypto-currencies)

market into a new domain – people remain interdependent even when some of their primary interests are
anonymity and security.
Examination of the darknet markets using a combination of these theories – market and system – helps us
conclude this mysterious corner of the Internet won’t be going away any time soon. Smith tells us that the
inherent characteristic of people to trade and barter goods and services will always drive demand for a
marketplace, and that as information about it improves, interest in the market will grow. Indeed, with the
attraction of the market and the empowerment of information, we should expect to see a reinforcing loop
in action: as more people use the darknet, more mainline businesses will set up shop there; with the
familiarity and ease they offer, even more people from all over the world will be encouraged to sign-on;
followed by even more businesses. Castell agrees with Smith about the globalization of the market
economy, and the former theorist goes even further, noting globalized criminals are to be expected within
such a structure, with restrictions on them leading only to “inroads into the freedom of capital” (Waterman,
p. 13). Castell’s idea of the network complements Parsons’s system explanation, from which we
understand the darknet, online and out of sight, to be showing itself as systemically resilient. For this
reason, the DNMs will continue to provide a convenient platform to transact business – of all kinds –
adapting and decentralizing even further to meet what threats may come from without the system. To be
seen is whether the opponents to such a networked economy can overwhelm its adaptive mechanisms and
collapse the system through compromise of the underlying communication or financial technology. Or
perhaps the system’s decentralization response will continue to protect it, perhaps even expanding to
encompass the delivery aspect of the market; for example, by the use of distributed drones to deliver the
goods – legal or otherwise; taxed or not – into the welcoming hands of the buyers, wherever they may be.
Whether this is likely or not in the near future is unclear. What does seem certain is that the innovation and
adaptability of the darknet, with some setbacks, continues to provide people with the means to do what
they want most to do – anonymously.
References:
Bartlett, J. (2014, November 7). The Silk Road shutdown is a blow to the dark net - but not a fatal one.
The Telegraph. Retrieved November 22, 2014, from
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dark-net-but-not-a-fatal-one.html
Beckett, A. (2009, November 25). The dark side of the internet. The Guardian. Retrieved November
22, 2014, from http://www.theguardian.com/technology/2009/nov/26/dark-side-internet-freenet
Chacos, B. (2013, August 12). Meet Darknet, the hidden, anonymous underbelly of the searchable Web.
PCWorld. Retrieved November 22, 2014, from http://www.pcworld.com/article/2046227/meet-darknet-
the-hidden-anonymous-underbelly-of-the-searchable-web.html
Chen, A. (2013, October 4). Silk Road's Downfall Killed the Dream of the Dark Net. Gawker.com
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the-dark-net-1441310875
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drug-market-is-russian/

Huckle, J. (undated). Manuel Castells on the Network Society. hackerart.org website. Retrieved
December 2, 2014, from
http://www.hackerart.org/corsi/fm03/esercitazioni/civardi/documenti/castells_07.htm
Ingraham, C. (2014, November 6). How the FBI just made the world a more dangerous place by shutting
down Silkroad 2.0 and a bunch of online drug markets. The Washington Post. Retrieved November 22,
2014, from http://www.washingtonpost.com/blogs/wonkblog/wp/2014/11/06/how-the-fbi-just-made-the-
world-a-more-dangerous-place-by-shutting-down-silkroad-2-0-and-a-bunch-of-online-drug-markets/
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Power, M. (2014, May 30). Life after Silk Road: how the darknet drugs market is booming. The
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is-booming
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freedoms-not-criminal-acts
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web/

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