Silk Road Trial Twist: Defendant claims Mt. Gox administrator Mark Karpeles was the real Dread Pirate Roberts
The Silk Road trial continues to escalate today (the third day of the trial) as the defense lays out their version of the history of the darknet drug market. The gist of their defense is that Ross Ulbricht is not, in fact, the mastermind behind the darknet site, but a patsy, who took the fall for the real villain — Mark Karpeles, the much-maligned figure behind the infamous Mt. Gox. In our imagined future biopic, there’s shocked silence in the courtroom.
The story goes like this: While the attorney, Joshua Dratel, admits that Ulbricht did initially found the Silk Road, he says that Ulbricht quickly handed off the day-to-day administration of the site to Mark Karpeles when the site began to grow, with Karpeles’ friend, Ashley Barr, taking over the role of Dread Pirate Roberts. Dratel says that Ulbricht only returned as administrator when it became clear to the real administrators that law enforcement was closing in.
Bloomberg reports that Dratel told the court:
“Ross was not a drug dealer, Ross was not a kingpin, Ross was not involved in a conspiracy to do anything like that,”
At first glance, this sounds like a transparent attempt to throw blame on an already-maligned figure in the Bitcoin community, but there is some reason to believe that there’s some basis to their claims. The defense called as a witness one of the principal investigators into the two-year investigation of the silk Silk Road, Jared Der-Yeghiayan, who testified that he had, in fact, determined that Karpeles was involved in the operation of the site. Der-Yeghiayan testified that,
“Lots of little things added up to [Karpeles] […] we have built up quite a large amount of information that leads to this,”
Later, Dratel asked Der-Yeghiayan,
“You believed him to be the mastermind behind Silk Road, keeping it secure and operating?”
Der-Yeghiayan’s reply was:
Der-Yeghiayan further testified that he was upset at the actions of law enforcement in the Karpeles case, which tipped him off to their suspicions and allowed him to flee their jurisdiction, and says that the investigation was botched by poor law enforcement coordination.
As matters stand, Ulbricht stands accused of drug trafficking, drug distribution over the internet, fraud, and various computer crimes. If convicted, he faces life imprisonment. Now, Ulbricht claims that virtually all of these crimes were actually committed by Karpeles. If he can make his defense stick, he could potentially negotiate his way down to a much lesser sentence. It’s not clear what would happen then: action against Karpeles would involve international cooperation and could take a very long time.
The ending of the biopic is still up in the air, but one thing is clear: it is going to get a lot of awards at Sundance.