Market Overview

How to Purchase Guns and Drugs Anonymously


Want to purchase guns and illegal drugs over the internet but without the traditional hassle of bank records? A new digital technology is making it possible.

In the past, most internet transactions required a credit card or an online payment system like PayPal (NASDAQ: EBAY), creating an effective digital paper trail for people engaging in online transactions.

While paper currency allows for anonymous transactions in the real world, it's obviously impossible to exchange paper notes over the internet, which is a problem for those looking to acquire goods and services without leaving behind a record. Enter Satoshi Nakamoto.

In 2009, Nakamoto created a new technology: the bitcoin. Bitcoin is an open-source, peer-to-peer, digital currency software. It allows users to exchange bitcoin files without keeping as detailed of a record of the transaction as would be required over PayPal or other electronic payment networks. The number of bitcoin files in existence is limited, and while new bitcoins come into existence every day, the rate of expansion in the bitcoin supply is known to all users.

Thus, the bitcoin works as a perfect digital currency. Although a record of every bitcoin transaction is stored on every computer running the bitcoin software, bitcoins nevertheless provide a significantly greater degree of anonymity in online payment. This anonymity is somewhat tempered by websites like, which do show a history of bitcoin transactions since January 2009.

Online retailers like Amazon (NASDAQ: AMZN) have yet to begin accepting bitcoins, and maybe they never will. But according to Smart Money, use of the bitcoin has flourished with smaller sites like The Arms Locker--a website that sells firearms. (The Arms Locker, however, is a fully-licensed arms dealer which states that the retrieval of firearms in-person requires the presentation of identification.)

There are also online exchange sites that allow users to purchase bitcoins with "real" currency. A year ago, a user could purchase two bitcoins for $0.01. Today, that same transaction would cost $21.

The rise of the bitcoin is obviously a story of technological progress, but perhaps it's more than that.

Since the financial crisis of 2008, central banks around the world have worked to expand their money supply in an effort to pump liquidity into the market. That has left some savers concerned about the future value of their currency.

The Federal Reserve, through quantitative easing, has greatly expanded its balance sheet and put more U.S. dollars into existence. That may have caused the recent decline in the value of the U.S. dollar, and the surge in the price of gold.

Traders who believe that the rise of the bitcoin underscores a growing dissatisfaction with the central banks of the world might consider a short U.S. dollar play. PowerShares Ultra DB US Dollar Bearish Index (NYSE: UDN) might allow traders to profit if the dollar continues to depreciate.


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