Pay the Devil in Bitcoin: The Creation of a Cryptocurrency and How Half a Billion Dollars of It Vanished from Japan (Kindle Single) by Jake Adelstein & Nathalie Stucky

Author:Jake Adelstein & Nathalie Stucky
Language: eng
Format: mobi
Published: 2017-09-10T04:30:00+00:00

CHAPTER FIVE

THE UNUSUAL SUSPECTS

After the shutdown of Mt. Gox, the bitcoin community and the media vilified Mark Karpelès as a clown, a con man, and a horndog. Japanese tabloid magazines portrayed him as a “beast” hiding in his “lair” and tracked him to his new address, a modest house in Toshima Ward, where he’d moved when money started to get tight.

His reputation was damaged further when, as 2015 started, the Silk Road trial began.

During the trial in a Manhattan federal courtroom, Ross Ulbricht’s lawyer immediately tried to peg Karpelès as the real Dread Pirate Roberts. Karpelès denied the accusation and said he had cooperated with US federal law enforcement.

“This is probably going to be disappointing for you, but I am not Dread Pirate Roberts,” he said.

The investigation reached that conclusion already—this is why I am not the one sitting [on] trial, and I can only feel defense attorney Joshua Dratel trying everything he can to point the attention away from his client.

I have nothing to do with Silk Road and do not condone what has been happening there. I believe bitcoin [and its underlying technology] is not meant to help people evade the law, but to improve everyone’s way of life by offering [never-thought-of-before] possibilities.

DHS Special Agent Jared Der-Yeghiayan, under cross-examination, said he had pursued Karpelès as the suspected owner and operator of Silk Road in 2012 and 2013. But Der-Yeghiayan acknowledged that the things Karpelès may have written online did not match the level of English skills that Dread Pirate Roberts possessed. He thought it was someone else close to him, a person who was working for him by the name of Ashley Barr. There is no solid proof behind this assumption, but if there had been an award for disgruntled employee of the month at Mt. Gox, Barr would probably have won it twelve months out of the year. There was certainly bad blood between him and his boss.

Other sources close to the DHS told us that Karpelès had been eliminated as a suspect in the running of Silk Road by the end of 2013 and confirmed that he had been generally cooperative with the government. He had notified them about discovering over a hundred fake American passports being used to set up Mt. Gox accounts and debarred the clients. He also acknowledged owning a web-hosting service used by part of the Silk Road network.

Dread Pirate Roberts, who seems to have known Karpelès was cooperating with the authorities, had tried to reach Karpelès many times in the months after Silk Road was closed down. On September 1, 2013, one month before Ulbricht’s arrest, he sent several e-mails to Karpelès’s bitcoinfoundation.org address with the header “info regarding active law enforcement investigation.” One read:

Greetings Mark

As the subject says, I have some information for you as well as a special request. I don’t want to say any more without PGP protection. Do you have a public key I could use?

Dread Pirate Roberts also tried to make contact with Mt. Gox employee Ashley Barr.

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