by Besim Likmeta

Introduction

The functioning of cryptomarkets is heavily based on trust. Because, drug vendors act with a pseudonym and do not meet buyers in person, they could easily deliver products of lower quality, or not to deliver items at all and get away with it.

Within cryptomarkets this problem is mitigated by the use of reputation systems, such as ratings, feedbacks and reviews of products and vendors, which are posted in their forums or on social media. These reputations systems provide an account of a vendor’s previous transactions and track record, as well as of the quality of their products, and can help to understand whether a vendor is trustworthy or not. 

These systems allow buyers to make more informed purchases and to avoid dealers who provide a low quality service.

Ratings and feedback

One type of reputation system is the ratings for individual products. After a buyer has ordered and paid for an item, they are prompted to leave a rating. These ratings are typically a number between one and five, in the same style as traditional ‘five star’ ratings.

Along with the numbered rating, customers are also encouraged to leave a short piece of feedback about their particular order. These snippets of feedback focus on a variety of different aspects of the customer’s drug purchase. The main aspects discussed on feedbacks are the stealth, the quality of the product and its delivery time. If the item doesn’t arrive at all, buyers can also write this in their feedback.

Besides these individual product ratings, some markets employ vendor ratings, such as the now-defunct Evolution market, where vendors were given a level ranging from one to five.

Abuse of ratings and feedback

One scam consists in the vendor generating the appearance that they are trustworthy. “Padding feedback” occurs when a vendor purchases drugs from themselves using a series of buyer accounts that they have created. To anyone else it appears that the customs are legitimate, while instead they are simply aliases of the vendor.

Another way ratings can be abused is vendors building up a reputation for being reliable and then suddenly switching behavior and scamming users of their bitcoins. Over time, a vendor with high ratings is deemed trustworthy by the users of the cryptomarket. Therefore, users may be willing to send their full payment for the product to the vendor before it has been shipped. However, a vendor could take advantage of this trust and accept as many payments as possible without shipping any drugs until users start to notice the discrepancy. The vendor will then close their account and disappear with the stockpiled bitcoins. This is commonly known as an “exit-scam”.

Reviews

Besides the short pieces of feedback, some users write much longer in-depth reviews which can appear on the forums of cryptomarkets or on other social media. A popular hub for this activity is the DarkNetMarkets sub-Reddit.

Reddit is a social media website that allows users to create sections dedicated to specific topics, or “sub-Reddits”. The DarkNetMarkets sub-Reddit concerns cryptomarket news, and it’s also a space where users can post reviews of vendors and their products.

Many of these reviews follow a template which includes a wide array of information, such as where the drug was shipped from, the quality of the product, its value for money, the communication between the buyer and seller, and the level of the seller’s security.

Why reputation matters

Reputation systems seem to provide buyers with greater confidence in using cryptomarkets. Vendor ratings are one of the main reasons that users are attracted to cryptomarkets and they are more comfortable purchasing drugs from vendors with a higher rating, according to surveys. 

When reputation systems are in place, the best dealers get rewarded with more customers. So thanks to reputations systems, cryptomarkets have developed a method of self-regulation: only vendors providing high-quality products and services will survive.

Reputation systems can also provide information to users about product quality and potential risks. The cryptomarket community can also use these reputation systems to flag vendors who sell one substance under the pretence that it is something else entirely. For example, the primary motivation of the LSD Avengers was to expose dealers who were selling research chemicals as traditional hallucinogens. 

Recent developments

Recently some cryptomarkets have adopted a new feature called “digital contracts”.  Each contract costs USD 5, payable to the administrators, and can contain anything that two contracting parties desire, as long as it relates to products already traded on the market.

However, these new contracts are for more long term business. The terms of the contract are then signed by the administrators with a PGP key. If one of the parties is cheated, they can address themselves to the administrators, who decide whether or not one of the parties should be stated to have ‘failed’ the contract. This failure will then be added to the offending user’s profile, for everybody to see, and if a user is deemed to be particularly untrustworthy, they may be banned from the site. If the contract is successful, and both parties are satisfied with the result, then a ‘completed’ note will be added to the users’ profiles. 

However, these contracts will not stop people scamming other users. It is possible for a user to make multiple accounts with the purpose of scamming while avoiding detection. There is also the problem of possible bias in a site administrator, who may have made another deal with one of the involved parties, perhaps to take their side in any dispute.

© 2021 Besim Likmeta. All rights reserved.