How Bitcoin Fuels the Dark Web | Blockchain Central

Hey everybody, welcome to a new episode on
BLOCKCHAIN CENTRAL! Today I will take you on a tour through the
underbelly of the Internet! I’m sure you’ve heard that there exists
a dark side with no regulations, no central control. It is called the Dark Web and we’ll see
how it takes advantage of blockchain technologies. The darknet is basically a second Internet. It does not have normal URLs or links as we
are used to in our browsers. Instead, websites are available via onion
addresses. These look something like that: …and they are not available on your regular
browser. Instead, you need to download a Tor browser. The Tor browser is a particular, privacy-focused
browser, that can resolve onion addresses. The darknet itself is also more privacy-focused. It has the reputation of being less monitored
than the regular internet. But, since the Tor project has been mostly
financed by the U.S government, there are controversies regarding the Tor browser being
actually traced by U.S authorities. Tor browsers and services are still seen by
most people as the area outside of government control. That is why, all sorts of different things
can happen there. Big newspapers, for example, can have whistleblowing
sites. Those are addresses where anyone can anonymously
tip a big story. There are also news sites that are too controversial
to be even present on the regular Internet. But the main difference is in the marketplaces. Anything that is in demand, can be found there:
porn, guns, contract killers… But the most significant form of a market
has to do with drugs. A search engine called Grams not only delivers
links to many such marketplaces across the dark web, but also looks very much like Google. So, let’s compare the darknet to a regular
marketplace. Take a regular service like Amazon. You have an account there under your real
name. When you want to buy something, your search
for it and Amazon shows you the item. You decide on a product and pay with a credit
card or PayPal. Theoretically, there are only two parties
involved: you and Amazon, but it’s not that simple. The system only works because the government
enforces the law. There are quality checks for products, laws
for purchases and laws for banks. There are patents protecting successful products. All of these laws have the goal to create
trust and certainty. When purchasing anything online, you heavily
rely on a functional government. And how would this work on the darknet? It has to be different, right? Well, there are no laws. That is why, people need other ways of building
trust. Darknet markets do not have copyright laws. If one product sells well, anyone can sell
it under the same name and design. There are no trade laws: whether you actually
ship your product or not is uncertain. And, of course, there is no quality control. So, how can it work? Product and merchant quality are assessed
via reviews and payments are made via Bitcoin escrows. An escrow works like this: a darknet marketplace
has a drug seller. If you want to purchase something, the money
goes into an escrow wallet. Basically, you pay the Bitcoins to the marketplace. Only after the product was received the money
is released to the seller. All of this typically works with Bitcoin. For years darknet drug markets have been the
only real use case for Bitcoin. Obviously, these marketplaces are highly illegal,
and eventually, they caught the attention of organizations like the CIA. Today, the all early marketplaces are gone. The biggest of all of them was the “Silk
Road”, which primarily used Bitcoin to manage its transactions. They boasted billion dollar annual revenues
before Bitcoin was even crossing the 500$ line. Today, it’s founder, Ross Ulbricht, is in
prison; he was caught in a public San Francisco library. The site is down, and a banner by the FBI
greets the curious visitor ever since. What have we learned today? The darknet is the Wild West of the Internet. It features a variety of marketplaces. These marketplaces have to find solutions
that work without enforced laws. Hiding from the government is also obligatory. That is why, payments are exclusively made
in cryptocurrencies. As the first cryptocurrency, Bitcoin became
the standard method of payment. For years now, this has been the most widespread
real-world use case of Bitcoin and cryptocurrencies. Fortunately, the potential for blockchain
technology in most industries has been discovered in the recent years, with many new real-world
use cases to come. Before you go, please note that this content
neither represents financial, legal, or tax advice, nor is it supposed to be understood
or interpreted as solicitation to buy or sell any securities, coins or tokens. Thank you so much for watching. If you liked this video, make sure to hit
that like button and don’t forget to subscribe to Blockchain Central to never miss a beat! Happy investing!

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