Bitcoins have been in the public eye for weeks as the price shot through the roof in a very short amount of time. As a virtual currency, they make for a great way to do transactions that both buyers and sellers may not want to be traceable. As a result, sketchy retailers like the online drug den Silk Road are especially interested in doing business through the currency.

Bitcoin

Over the weekend the site posted a notice that someone using the name “Lance G” threatened to crash the site if it didn’t pay $5,000. According to the Telegrah, Silk Road has confirmed that an attempted blackmailer is responsible for the denial of service attacks on its site.

A Marketplace Based On Bitcoins

The attacks on Silk Road may be because its marketplace is tied directly to the value of bitcoins. The sudden rise in the price of bitcoins has made Mt. Gox, the most well-known exchange for the currency, the target of online denial of service attacks as hackers sought to influence the value of the currency and take advantage of suddenly plummeting prices caused by their attacks. Today bitcoins have traded as high as $141 on the exchange, although they were as high as $225 less than a month ago.

Silk Road enables drug dealers to sell their drugs online, and by using bitcoins as currency, the transactions are untraceable. However, The Telegraph reports that dealers on the site have been selling less lately, probably because of the skyrocketing value of bitcoins at first and then later because dealers may have become less willing to sell their drugs for bitcoins after the price crashed.

Silk Road is now offering a $5,000 reward to anyone who offers information which leads to the arrest and conviction of the person attacking the site. However, you can imagine how motivated authorities would be in tracking down the person who crashed a drug dealing site.