Atlantis wasn’t built in a day: The web’s newest black market has $520,800 in sales and counting

June 13, 2013 — 9 Comments

Atlantis, the third largest and newest black market on the deep web, has more than doubled business in the past six weeks. Three months after launch, they’ve processed a total of $520,800 worth of orders. The founders, vendors and customers would like much, much more.

atlantisfront

If the online drug trade is theater, Silk Road is standing center stage. The web’s most successful and well known black market is making millions of dollars worth of sales every month while the media spotlight keeps the public’s attention on it.

Black Market Reloaded is off in the relative shade of stage right, growing steadily, processing around one million dollars in sales per month and obviously happy to not be paid quite so much attention as Silk Road is.

With few exceptions, the stage looked basically this way for nearly two years until the recent emergence of a new player.

Atlantis Marketplace‘s March 2013 entrance was dramatic. The announcement that a new black market had been launched was made on numerous forums, notably including Silk Road’s newbie subforum.

The tone often veered toward antagonistic. Silk Road user masterblaster wrote this about Atlantis:

Faster,
Cheaper,
Functional
Stable

So long road, we wont miss your 2 minutes page loads and frequent crashes. Hey, why are you all reading this, is the road down again?

Some users wondered if Atlantis had astroturfed support on Silk Road’s forums. Others wondered if Atlantis could compete with the giants already on stage. Most troubling of all, many wondered if Atlantis was a sleek new honeypot created by law enforcement with the goal of of luring customers and vendors to their undoing.

“As long as the road is alive this is where i will be,” wrote worm11. “Atlantis sounds like it is run by fucking cops!”

Loera and Vladimir are the two public faces behind Atlantis. They are the counterparts to Silk Road’s Dear Leader Dread Pirate Roberts and Black Market Reloaded’s founder backopy.

Loera and Vladimir refer to themselves as executives. In an attempt to address the questions surrounding their new business, the pair spoke with All Things Vice’s Eileen Ormsby in April, six weeks after launch.

“It’s only natural for people to be a bit sceptical at first,” he says. “However many people have made successful sales on Atlantis, and the scepticism is starting to fade”. He states that Dread Pirate Roberts (Silk Road’s founder) had to begin under the same circumstances.

As Ormsby pointed out, that statement doesn’t ring particularly true. Dread Pirate Roberts, the founder and owner of Silk Road, effectively launched an industry. She wrote:

At the time Silk Road started, there was no knowledge of internet drug trade outside a few uber-geeks, and no incentive for the law to create such a honeypot.  Now, with global mainstream media coverage and drug dealers openly and blatantly advertising their wares online, mass arrests would be seen by the public as a win in the ongoing ‘War on Drugs’. Such sting operations in the face of public outrage are not unprecedented.

“There’s no good way to prove to the community that we’re not a honeypot, Loera concedes. “All we can do is continue to do what we’re doing, and the success stories of the community will speak for themselves”.

As the market recently crossed the $500,000 milestone, the success stories have steadily begun to roll in.

The most recent statistics for Silk Road date back to an August 2012 study which estimated that the marketplace did $15.2 million US dollars in sales annually or $1.2 million US dollars in sales per month approximately 1.5 years after launch. The number has likely grown considerably by now, nearly a year of growth later.

Black Market Reloaded’s most recent statistics (from April 2013) claim about $700,000 per month in transactions on the market. If that number remains steady — and it generally hasn’t remained steady, it’s growing quickly — BMR can expect $8.4 million in sales annually.

In three months since the launch of Atlantis, the new market has processed a grand total of $520,800 worth of orders. That plays out to about $173,600 per month and $2 million in sales annually.

However, those last two numbers critically undershoot what ought to be expected from the market over the rest of the year. Over the last six weeks, the amount of money in circulation on Atlantis has more than doubled. Like Silk Road and BMR, Atlantis is on a steadily upward trajectory.

“I’d say we’re around two to three times busier than we were since our interview with Eiley from All Things Vice,” the two founders wrote in an interview conducted this week.

Just like at BMR and, presumably, Silk Road, it seems that no growth ceiling has been hit. In fact, there’s little reason to believe any of the players in the online drug trade will reach that growth ceiling anytime soon.

Conservative estimates show these three black markets will combine to process at least $25 million in sales this year. Impressive though it is, $25 million is an infinitesimal portion of the worldwide drug trade (which totals in the hundreds of billions at least). As these online marketplaces grow, as they build more trust, visibility and features, they can take advantage of an increasingly online-savvy, drug-friendly world. Considering the global legal environment, the market’s growth potential is far from infinite and will meet considerable obstacles — don’t get too excited — but the potential has not been met yet.

The big question is, just how much of the world’s drug trade can shift to the internet?

blackmarket chart 62013

It’s safe to assume that these numbers will prove to be low by December 2013.

While the vendors at Black Market Reloaded seem happy to play wealthy supporting roles, Loera and Vladimir aim to lead despite the host of challenges that high visibility has brought Silk Road. I asked what Atlantis has that the Road doesn’t.

“To put it bluntly, a well written codebase and server setup. SR claims to have suffered from ‘DDoS’ attacks, which is very unlikely due to the way Tor hidden services are designed. It’s far more likely to me and technical gurus I’ve consulted that it was a result of poor or uncoping infrastructure. Most likely database related. Ironically we still received all the blame for the supposed ‘attacks’.”

The biggest challenge for Atlantis has been building a customer base.

“Finding the traffic has been our only struggle so far. It’s hard to convince people to change their ways, they become complacent. We need to show them that it’s worth it!”

Atlantis gets thousands of visitors per day, wrote Loera, and processes “in the low hundreds of orders a day. These do fluctuate though. Sometimes we have low days. We have close to 600 vendors at this point (half of SR’s vendor count according to a blog I read recently), so they’re distributed across all of them.”

A recent prominent thread on the Atlantis forums featured numerous vendors wondering how the operation could attract more traffic.

“i dont even have any damn feedback on SR yet,” wrote vendor MissBliss, “and ALREADY with listings only 48 hours old on the road, i’ve sold just about 2/3 as many pills vs what i’ve sold on atlantis for over a month with a priority listing & glowing feedback… cant wait till these SR sales get reviewed and more buyers over there become comfortable with me.. expecting shit to really take off in the next few days or week.”

Canman, a cannabis vendor on both markets, compared the two:

“Experience wise, Silk Road contains the critical mass of buyers which is the main difference,” he wrote. “I would say I sell 20-30 times the volume on Silk Road, compared to Atlantis as it stands. Silk Road core site functionality works well, but Atlantis has the feel of a more seasoned development team in looks and the rapid deployment of new features.”

TheDrugFederation is the third largest vendor on Atlantis with 115 items sold in two months including LSD, MDMA and Adderall. He recently began selling on Silk Road as well.

The prospect of prominent Atlantis vendors opening up accounts and selling many times more product on Silk Road is definitely worrisome for Atlantis management. However, none of the vendors who have laid down roots at the new market seem to want to abandon it. Vendors want to stay because it’s easy and smart to list your products on multiple sites.

“No, I can not see any point where I would leave Atlantis,” wrote canman. “I personally did not expect even this volume early on, it is going to take time to build repeat customer business and trust with Atlantis as a whole. I am also very satisfied with the staff running Atlantis. Feature requests are actually listened to and support requests handled very quickly. Silk Road suffers a little from its popularity and I think their staff get somewhat overwhelmed at times, and backlogs build up.”

There are two paths toward growth for Atlantis.

First, they can take vendors and customers from Silk Road. To do this, Atlantis offers lower rates and boasts 100% uptime since launch, a stark contrast to Silk Road’s numbers.

Loera laid out what he thinks are most important unique features on Atlantis:

  • Automated PGP encryption (our statistics indicate only 10% of users use encryption, rather dissapointing, so we’re trying to curb that)
  • Anonymous yet useful feedback system (we show randomized IDs instead of usernames, unique to the seller/buyer combination. This prevents any attempts at tracking a users buying patterns and at the same time allows you to determine if it’s the same user leaving feedback on multiple orders. We also show the amount of the transaction, the age of the account and the number of purchases/sales. All of these statistics are paramount in weeding out any potential scammers.)
  • Buyer feedback system (something SR is lacking is the ability for sellers to leave feedback for buyers. This allows buyers to earn a reputation as well, and sellers can choose to deal with trusted buyers only.)
  • Restricted Finalize Early (we only allow our trusted vendors *see seller guide for requirements* to request Finalize Early, the option is not physically available for other sellers, and requesting it will have them banned. This has proven to be a priceless technique for protecting users and weeding out scammers.)
  • Locked Feedback (we’ve noticed that buyer bribery is commonplace on SR. Buyers ask for freebies or threaten to leave negative feedback on a sellers profile. We don’t allow our feedback to be modified after it’s placed, preventing this from taking place.)
  • Bitcoins AND Litecoins (we accept multiple cryptocurrencies, the first marketplace — deepweb or otherwise — to do so. This allows our vendors to reach out to more potential buyers, and vice-versa.)
  • Our Interface Design (I’m sure you’ve heard this already from our vendors and buyers, they all love the site design and it’s layout.)
  • Cheaper Rates (our vendor accounts only cost $35 — compared to SRs large $500 fee –, and our commission is far far lower than SR’s. You can list your items for cheaper to compensate to catch more buyers, or leave them at the same price and enjoy the extra bonus on your sales.)
  • Fan Management (we have a great interface for keeping track of your favorite buyers items, and vendors have a great way of reaching out to all of their favorite buyers using our Fan Management system.)
  • Downtime (no recorded downtime to date, we’re reliable.)
  • Website Speed

The second path to growth is attracting customers entirely new to online black markets.

“Most people have never heard of this sort of thing before,” wrote Loera, “and I’m certain lots of them would be pleasantly surprised.”

“Bringing in new users will be key,” wrote vendor Canman, “be it through guerrilla marketing of sorts. I hope they can target users completely new to cryptocurrency and free/black markets, once trust is established with a site they have little reason to look elsewhere.”

The online drug trade experienced a rebirth with Silk Road’s launch in 2011. Today, it’s in its toddler years. Silk Road might receive major media attention and get compared to tech giants like Amazon but there exists an enormous set of potential customers who haven’t yet been reached. Atlantis is banking on it.

The executives launched an AMA on reddit in a bid to raise awareness. The site saw an uptick in traffic including 900 unique logins on Tuesday, a few days following the AMA. Since that time, they’ve hired a marketer to make a more formal and organized push for publicity. They’ve announced an imminent YouTube presence to increase popularity including video guides and commercials. With full-time marketers working on the site’s behalf (paid in BitCoin of course), one can expect regular substantial publicity pushes around the web in the immediate future.

The stated goal is to beat Silk Road in the long game and take center stage for themselves.

“Atlantis stands a good chance at success if they can survive their first year,” wrote Canman. “If the site administration is patient, I assume this would be extremely lucrative if they can even achieve 10% of Silk Roads volume.”

Being featured on the marquee is awfully nice but, in this show, just being a player can mean a windfall.

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