A $50M Drug And Gun Dark Web Market Just Disappeared And Millions In Bitcoin With It
It had become a bigger, badder version of the Silk Road drug bazaar in its short life, but Evolution
, founded on 14 January last year, has apparently been closed and one staffer is claiming the admins have scammed its huge user base. The site, based on the anonymising Tor network, was home to nearly 20,000 drug sales at the time of its apparent demise
, far more than Silk Road or its subsequent iteration Silk Road 2, but also sold weapons, from guns to tasers hidden in fake cigarette packets, and plenty of fraud material. It was also slicker, faster and more professional than other dark web markets, but is ostensibly no more.
According to the site’s public relations manager (it also had a doctor and a legal expert), who goes by the name NSWGreat, the admins, who use the monikers Verto and Kimble, have scammed all users and disappeared. Ironically, the site had what was supposed to be a security feature, with funds held in escrow until at least two of the parties involved in a transaction signed off. That meant placing a good deal of trust in the holders of the escrow Verto and Kimble, which wasn’t, it appears, merited, as all those funds have now been pilfered, according to NSWGreat.
“I hate to the bearer of bad news, but I’ve been suspicious the past few days with withdrawals not working and admins usually are more forthcoming in explaining to me why they’re slow but they weren’t this time. Just kept giving me time-frames,” NSWGreat said in a Reddit post. He or she also confirmed what was happening to FORBES over email, though it remains unclear exactly what’s happening, such is the nature of dark markets. In a general email sent to various media outlets, NSWGreat said the theft was as high as $15 million.
“I have admin access to see parts of the back end, the admins are preparing to exit scam with all the funds. Not a single withdrawal has gone through in almost a week. Automatic withdrawals has been disabled which is only doing on rare occasions,” the PR added on the site. “I am so sorry, but Verto and Kimble have fucked us all. I have over $20,000 in escrow myself from sales. I can’t fucking believe it, absolute scum. I am giving this warning to you all as soon as I possibly could of.
“Confronted Kimble and Verto about it, they confirmed it and they’re doing it right now.”
Weapon sales on Evolution marketplace, including a taser hidden in a pack of Marlboro Reds
The warning signs had been coming in recent days, with various users complaining about delayed withdrawals of funds from Evo, as users called the site. Not only is the site now down, so is the associated forum. The Hub forum, another site used to discuss dark markets, is also out of action (though it’s frequently up and down). The Shiny-Flakes dealership, which German police claimed to have neutered last week in a major bust, had left an ominous message on their vendor page last week too: “DO NOT BUY HERE. VENDORS RUN FOR YOUR LIFE.”
One of the site’s founders, Verto, previously ran Tor Carding Forums, where stolen credit card data was shifted around, so it may not come as a surprise to some that Evo might have been a very well-executed scam.
He or she may not have felt it was worth continuing, given their salary would have amounted to far less than they were holding in escrow. Estimates drawn together by security expert and dark market aficionado Greg Jones for FORBES indicate the owners of the site would not have been making vast sums in comparison to how much was going through the site. Verto and Kimble made most of their money from commission. The fees on Evo were, according to Verto forum posts, the lowest of all markets, with an incentive-based sliding scale of 2.5 – 4 per cent per transaction; vendors who’d made more than 150 Bitcoin in their overall Evo trading got the least commission taken off their individual sales.
To get an estimate of how much was passing through the site, Jones scraped information on the 2,194 known Evolution dealers (546 were disabled or suspended), all product listings and 90 per cent of customer feedback. From all this, Jones determined there were approximately 475,000 transactions over the last year, many of which would have included multiple items (it’s not possible to tell where this happened). Looking at the feedback, he determined a mean value of transactions at $90. To get a year’s revenue figure, Jones pushed his sum for the cost of an average transaction up to $110 to account for multiple items and postal costs. He multiplied that by 475,000 and got $52,250,000. If Verto and his cohorts took an average 3.5 per cent annual commission, they’d have made $1,828,750, or $152,395 a month. By simply scamming everyone, they would, and may have, made a lot more in one fell swoop.
When researchers attempted estimates for the Silk Road in 2012, a year after its founding, total annual sales were at $22 million. In the two and a half years of operating up till October 2014, its total sales reached around $200 million, according to Ulbricht’s prosecutors.
Evolution had been growing fast and was set to make more. According to data from the Digital Citizens Alliance, at the end of January 2014, two weeks after launch, there were 5,812 listed products on Evolution. By August that had shot up to 13,699. In February of this year, that figure had more than doubled to hit 32,496. It continued to rise. The forum for the site boasted more than 28,000 users, with 150 joining every day.
Fraud material on the site was enough to concern financial services firms too. Digital Shadows, a London-based cyber intelligence startup, has tracked the site and dealt with a number of incidents arising out of fraud activity on the market. In a report put together for FORBES, CEO Alastair Paterson noted one of his client’s data was for sale on Evo and a sample made available for free as proof of the information’s validity. Digital Shadows, which is one of only a handful of firms to have created a search engine for the dark web, sent the data to the client, who confirmed its validity, found the source of the leak and shut it off. In another case, an Evo user sought compromised insiders within financial services firms, one of which was a Digital Shadows customer. Paterson wouldn’t go into detail on exactly what happened next, other than to say his private sleuths tracked responses to the ad, in case an employee was tempted to the dark side.
With so many valuable goods on their site, Verto and Kimble would have stood to have made a decent sum if they’d continued. But getting rich fast may have proven too much of a temptation.
Reddit users seeking mob justice believe they have found the Bitcoin wallet address that at least one of the admins is using to draw in Evo dealers’ funds. It has seen an influx of large sums of Bitcoin in the last week, with its total now at 43,083 BTC, the equivalent of $12.2 million at the current exchange rate. There’s no proof that wallet isn’t legitimate, however.
Whatever the truth, the apparent death of Evolution will likely send shockwaves across the dark markets. It was deemed by its users and many onlookers as the most secure and stable option around, with Agora being the only other dark market that was really challenging it for the dark market crown.
There was also a sense of bonhomie on the forums where vendors and buyers of all those illicit goods spoke freely and cordially with one another. To celebrate its first birthday on 14 January, vendors of drugs, guns and stolen credit cards organised a competition to raise $8,290 to be given away to buyers.
In recent conversations with FORBES over encrypted email, NSWGreat had talked positively about his bosses and about the nature of the site in general. “They are very professional at their job. I have nothing but the utmost respect for both of them. Rarely does anyone actually get to meet them, being one of the privileged few to know them on personal terms. I can honestly say they’re genuinely nice and normal people.
“I know the general consensus is we’re fueling illegal crime and should be stopped at all costs, but really anyone who is actually a part of the community knows the majority of the people on the dark net want to get away from all those violent and inhumane crimes. If we could control the production as well we would (and many vendors have) but unfortunately not everyone wins out in life.”
If Evolution really is gone for good, it won’t just leave Evo’s users in shock (and bereft of serious Bitcoin), but will likely put many off dealing with centralised markets at all. Some of the biggest dealers, including the charmingly-named HonestCocaine and UKGanja, had already started setting up their own bespoke shops. Either Agora will see a huge influx of customers, or a lot of little markets will rise. It won’t be the death of drug sales on the dark web.