Ross Ulbricht Got a $31 Million Donation From a Dark Web Dealer, Crypto Tracers Suspect

When Ross Ulbricht received a $31 cardinal bitcoin aid past play from an chartless source, galore observers saw it arsenic much than a very bully welcome-home gift. Rumors swirled that nan creator of nan Silk Road, little than 5 months aft receiving a pardon from Donald Trump that saved him from a life successful prison, was sending himself a trove of his stashed criminal proceeds from his days running nan acheronian web's first achromatic market much than a decade prior.

Now cryptocurrency tracing investigators opportunity they've arrived astatine a alien explanation: The money wasn't primitively Ulbricht's, and didn't travel from nan Silk Road. Instead, they fishy it came from a different long-defunct dark-web achromatic market: AlphaBay.

The crypto tracing patient Chainalysis tells WIRED that, based connected blockchain analysis, it has tied nan root of nan 300 bitcoins sent to Ulbricht connected Sunday to personification progressive successful AlphaBay, a acheronian web marketplace that sold a wide assortment of narcotics and cybercriminal contraband from 2014 to 2017 and yet grew to beryllium 10 times nan size of nan Silk Road, according to nan FBI.

Chainalysis says nan costs look to person emerged from AlphaBay astir 2016 and 2017. Given nan magnitude of nan donation, Chainalysis suggests it mightiness person travel from personification who acted arsenic a large-scale seller connected nan market. “We person reasonable grounds to fishy that these costs originated successful AlphaBay,” says Phil Larratt, Chainalysis's head of investigations and a erstwhile charismatic astatine nan UK's National Crime Agency. “Looking astatine nan amount, that would propose they came from personification who was perchance a vendor connected AlphaBay backmost successful nan early days.”

WIRED reached retired to Ulbricht for remark astir nan donation's root via contacts astatine nan Free Ross run that lobbied for his pardon, but didn't instantly person a response.

Prior to Chainalysis’ uncovering that nan $31 cardinal aid appears to person originated astatine AlphaBay, nan independent crypto-tracing interrogator known arsenic ZachXBT had already posted to his relationship connected X his ain findings that nan money didn't look to person travel from nan Silk Road. ZachXBT recovered that, contempt nan donor's usage of aggregate Bitcoin “mixers” that return successful users' coins and return others to obfuscate their way connected nan blockchain, he was capable to trace nan costs to an reside that had been flagged successful Chainalysis’ package instrumentality Reactor arsenic tied to illicit activity. That study suggested that nan money was a “legitimate aid but not morganatic funds,” ZachXBT wrote successful a matter connection to WIRED.

ZachXBT besides recovered that nan aforesaid individual who controlled nan costs had cashed retired different cryptocurrency astatine an speech successful small, distributed quantities alternatively than successful a azygous sum, suggesting he aliases she whitethorn person been trying to forestall them being seized aliases flagged—another motion that nan money whitethorn person travel from criminal origins. “Usage of aggregate mixers, spreading retired CEX deposits, etc,” ZachXBT writes to WIRED, utilizing nan word CEX to mean a centralized exchange, “that is done typically if you are trying to debar getting illicit costs frozen.”