For those not reading the article, please note this isn't just a claim made by the defense. This came out of cross examination of a DHS agent.<p><pre><code> "You thought you had probable cause that Mark Karpeles
was intimately involved, as the head of Silk
Road, correct?" Dratel asked Homeland Security agent
Jared Der-Yeghiayan.
"By the contents of that affidavit—yes," he answered.</code></pre>
Breaking News: Mark Karpeles says that Ross Ulbricht is responsible for Mt. Gox theft, was actually the CEO of the the failed exchange the whole time.<p>That said, this is actually a great defense.
This headline seems unbelievable, but if all the evidence in the article it is actually real, it does cast some reasonable doubt.<p>An alternative which hasn't been discussed yet is that maybe Karpeles was the Dread Pirate Roberts and <i>then</i> Ulbricht was. It has long been theorized that, like the original name from <i>The Princess Bride</i>, the title "Dread Pirate Roberts" was passed from person to person. DerYeghiayan seems to have had some reason to believe that Karpeles was DPR, while the prosecution seems to have reason to believe that Ulbricht is DPR. Why not both?
From The Verge article (<a href="http://www.theverge.com/2015/1/15/7553591/silk-road-trial-ross-ulbricht-mt-gox-mark-karpeles" rel="nofollow">http://www.theverge.com/2015/1/15/7553591/silk-road-trial-ro...</a>):<p>"One of Karpeles' companies had registered 'Silkroadmarket.org,' leading investigators to consider him as a suspect."<p>Silk Road launched in February 2011: that's the same month Karpeles (or his associate at Mutum Sigilum) registered the domain<p><a href="https://who.is/domain-history/silkroadmarket.org" rel="nofollow">https://who.is/domain-history/silkroadmarket.org</a>
I wonder if this play will hold up? When they busted Ulbricht at a public library, didn't they catch him in the act of talking to agent DerYeghiayan via Pidgin who told Ross to check out a support ticket? I thought they had screenshots of the chat as well as Ulbricht being logged into the site itself. They have conclusively linked Ulbricht to the site, however, they have failed to conclusively prove that he is the mastermind of the site itself and that there weren't others involved.<p>So my limited understanding here and what this case is actually about is that it is not so much trying to prove that Ulbricht had anything to do with the site (because the association was proven), but rather who actually was the mastermind behind the site (and pocketing large sums of cash from transactions). Seems association with such a site would carry a lesser charge than being the one who was profiting off of the marketplace and behind its original conception (this is my limited understanding and it could be wrong).<p>This story is absolutely insane, it will be interesting to see where this case heads. From what I gather, the bust in the library, screenshots of the chat and admin panel of the site and supposedly a few scrunched up pieces of paper found in the bin of Ulbrichts home are all they have (that we know about). There is nothing that actually proves or disproves that either Ulbricht or Karpeles, are the owners of Silk Road.<p>Now we just need the defence to come out and claim that Karpeles is actually Satoshi Nakamoto and then we've got ourselves a super interesting case. There is undoubtedly a movie script in here somewhere once the case is finished.
It's an interesting tactic, but will likely fall upon deaf ears. They arrested him at the library while he was logged into the site as an admin. That, combined with the fact that he possessed a Bitcoin wallet with ~144,000 BTC (worth ~$28.5 million at the time) in it, will likely carry more weight than any argument that other people were possibly running it. They also admitted on day 1 of the trial that he created SR - they are just saying that he turned it over to someone else and wasn't running it. All the government has to prove now is that he profited from it, which seems like a very low hurdle given the amount of BTC he had.<p>Based upon all of this, I'd say he has a 99.9% chance of conviction, and will receive a sentence that will amount to life in prison. This judge will make an example out of him.
If this is true then nearly all of bitcoin's growth over the last 3 years can be directly attributable to Mark Karpeles, either in the form of outright price manipulation, or the running of illegal goods marketplaces.
If this theory wouldn't make a an awesome yarn for a Sorkin/Fincher movie I don't know what would. Karpeles to be played by Paul Giamatti and Ulbricht by Robert Pattinson.
One thing I haven't see in the legal analysis: If Ulbricht is guilty of the things that the defense has stipulated (building and running SilkRoad for some period of time), doesn't that mean he's admitted to most of the relevant charges?<p>I'm not sure what the "I'm not the kingpin" defense actually buys.
The subtle implication here is "throw some shit at the wall and see what sticks" was Der-Yeghiayan's investigative method of choice. Always good to discredit the prosecution's lead witnesses if you can.
I don't think there was anything fundamentally unethical about Silk Road (other than the owner very likely attempting to have several people murdered, of course), but the defense is clearly grasping at straws here.
Lol. When I was at school this tactic, creating doubt by blaming someone else, was called "Plan B" after a plot line from the TV series The Practice.
A slightly different take on the news from The Verge: <a href="http://www.theverge.com/2015/1/15/7553591/silk-road-trial-ross-ulbricht-mt-gox-mark-karpeles" rel="nofollow">http://www.theverge.com/2015/1/15/7553591/silk-road-trial-ro...</a>
All this talk about "reasonable doubt" reminded me of "12 Angry Men" (1), a 1957 movie that follows a jury in its deliberation of whether a man committed murder or not. The whole movie takes place in a single room, with the 12 same actors, yet it manages to be captivating throughout. Really a great piece of cinema.<p>There's even a relevant xkcd (2).<p>(1) <a href="http://en.wikipedia.org/wiki/Twelve_Angry_Men" rel="nofollow">http://en.wikipedia.org/wiki/Twelve_Angry_Men</a>
(2) <a href="http://xkcd.com/657/" rel="nofollow">http://xkcd.com/657/</a>
The only chance Ulbricht seems to have at this stage, admittedly from where I am sitting, seems to be one where his team employs "defence through obscurity". If they can bog the trial down in technical details, question the witness credibility, and point fingers toward others then it will distract from harder evidence to counter.<p>It's a fairly common trial strategy, and sometimes it works.
This has become the Tech Industries version of the OJ Trial.<p>As someone who followed that trial very closely, I think the coverage of this trial has been really good.
Not one but <i>two</i> (nearly identical) references to "The Princess Bride" have been flagkilled. I understand not wanting to devolve into reddit, but is HN really so humorless? This is life imitating art, people. In this context, such references are 100% on-point.<p><i>He wasn't the real Dread Pirate Roberts either. The real Roberts has been retired fifteen years and living like a king in Patagonia.</i>