Silk Road founder arrested ...

[Adam Back]

Without getting into the rights and wrongs of drugs policy, and the case, I
suspect the silk road shutdown is good for bitcoin because it shows that
even if bitcoin were very anonymous (which its not due to being a public
ledger system), people are not completely immune from tracing even aside
from that if they become a big enough target, and it is easy enough to slip
up on security in operating a service.

(Surely the NSA could've figured it out anyway with their Utah datacenter
full of global internet traffic tracking info if anyone cared enough to get
the clout to demand it from them, and from recent news its stated they will
give evidence of crime to law enforcement if they find it as part of foreign
national security activities.  Whether they take requests to go trace things
from law enforcement is a different question - seemingly not hinted at yet
in the Snowden revelations.  But apparently they're not beyond covering up
the source with fake cover stories of how they found the info even to
judges.)

Also I read somewhere that silk road was using an offchain payment (not
strictly bitcoin but bitcoin converted into some silk road operated server. 
maybe its described somewhere for people who dont have ToR running, perhaps
it was a chaumian token server?).

>I also think this adds nothing to any argument over Bitcoin, because
>again, he got caught by being dumb. Bitcoin+Tor still seems pretty
>ironclad as a hosting platform for illegal activities.

Well not so fast there, without slip by operator being reported, that guy in
Ireland operating a ToR focussed mini-ISP got identified, and/or his clients
did and it spilled over on to him, or whatever happened.  (That one based on
some browser bug and jscript attack inserted by law enforcement somehow). 
High grade security is not for the careless - need to follow advise, eg ToR
browser bundle and scripts off or such?

Adam