Hard Interventions and Innovation in Crypto-Drug Markets: The Escrow Example

GDPO Policy Brief 11


  • Comparative analysis of mass data crawled from Silk Road and Silk Road 2.0 reveals that there is some evidence to corroborate assertions that ‘hard’ law enforcement practices may contribute to the adoption of specific technological innovations in crypto-drug markets
  • Specifically, the study applied a corpus linguistics assisted discourse analysis methodology to crypto-drug market community attitudes toward escrow technologies. Although a subsequent theft of Bitcoin held in Silk Road 2.0’s escrow accelerated community determination to adopt innovated escrow solutions, initial concerns about the viability of this crucial trust technology were found to have their genesis in the period following law enforcement’s closure of the original Silk Road
  • The analysis suggests that the FBI’s seizure of the original Silk Road may have fired the starting gun in the race to adopt decentralised escrow in crypto-drug markets. More broadly, ‘hard’ law enforcement strategies designed to support prohibition-orientated polices online may therefore be counter-productive to some degree
  • When generalised, this specific example of a resultant breakdown in trust in traditional centralised escrow - and subsequent drive to adopt technological innovation - may also be true of other advances in crypto-drug markets technologies