there really is only one place to go,

and that is the dark net anonymous markets.

Now, you can't get to these sites

with a normal browser -- Chrome or Firefox --

because they're on this hidden part of the Internet,

known as Tor hidden services,

where URLs are a string of meaningless numbers and letters that end in .onion,

and which you access with a special browser

called the Tor browser.

Now, the Tor browser was originally a U.S. Naval intelligence project.

It then became open source,

and it allows anybody to browse the net

without giving away their location.

And it does this by encrypting your IP address

and then routing it via several other computers around the world

that use the same software.

You can use it on the normal Internet,

but it's also your key to the dark net.

And because of this fiendishly clever encryption system,

the 20 or 30 -- we don't know exactly -- thousand sites that operate there

are incredibly difficult to shut down.

It is a censorship-free world visited by anonymous users.

Little wonder, then, that it's a natural place to go

for anybody with something to hide,

and that something, of course, need not be illegal.

On the dark net, you will find

whistle-blower sites, The New Yorker.

You will find political activism blogs.

You will find libraries of pirated books.

But you'll also find the drugs markets,

illegal pornography, commercial hacking services,

and much more besides.

Now, the dark net is one of the most interesting, exciting places

anywhere on the net.

And the reason is, because although innovation, of course,

takes place in big businesses,

takes place in world-class universities,

it also takes place in the fringes,

because those on the fringes -- the pariahs, the outcasts --

they're often the most creative, because they have to be.

In this part of the Internet,

you will not find a single lolcat,

a single pop-up advert anywhere.

And that's one of the reasons why I think

many of you here will be on the dark net fairly soon.

(Laughter)

Not that I'm suggesting anyone in this audience would use it

to go and procure high-quality narcotics.

But let's say for a moment that you were.

(Laughter)

Bear with me.

The first thing you will notice on signing up to one of these sites

is how familiar it looks.

Every single product --

thousands of products --

has a glossy, high-res image,

a detailed product description, a price.

There's a "Proceed to checkout" icon.

There is even, most beautifully of all,

a "Report this item" button.

(Laughter)

Incredible.

You browse through the site, you make your choice,

you pay with the crypto-currency bitcoin,

you enter an address -- preferably not your home address --

and you wait for your product to arrive in the post,

which it nearly always does.

And the reason it does is not because of the clever encryption.

That's important.

Something far simpler than that.

It's the user reviews.

(Laughter)

You see, every single vendor on these sites

uses a pseudonym, naturally enough,

but they keep the same pseudonym to build up a reputation.

And because it's easy for the buyer to change allegiance whenever they want,

the only way of trusting a vendor

is if they have a good history of positive feedback

from other users of the site.

And this introduction of competition and choice

does exactly what the economists would predict.

Prices tend to go down, product quality tends to go up,

and the vendors are attentive,

they're polite, they're consumer-centric,

offering you all manner of special deals, one-offs,

buy-one-get-one-frees, free delivery,

to keep you happy.

I spoke to Drugsheaven.

Drugsheaven was offering excellent and consistent marijuana

at a reasonable price.

He had a very generous refund policy,

detailed T's and C's,

and good shipping times.

"Dear Drugsheaven," I wrote,

via the internal emailing system that's also encrypted, of course.

"I'm new here. Do you mind if I buy just one gram of marijuana?"

A couple of hours later, I get a reply.

They always reply.

"Hi there, thanks for your email.

Starting small is a wise thing to do. I would, too, if I were you."

(Laughter)

"So no problem if you'd like to start with just one gram.

I do hope we can do business together.

Best wishes, Drugsheaven."

(Laughter)

I don't know why he had a posh English accent, but I assume he did.

Now, this kind of consumer-centric attitude

is the reason why, when I reviewed 120,000 pieces of feedback

that had been left on one of these sites over a three-month period,

95 percent of them were five out of five.

The customer, you see, is king.

But what does that mean?

Well, on the one hand,

that means there are more drugs, more available, more easily,

to more people.

And by my reckoning, that is not a good thing.

But, on the other hand, if you are going to take drugs,

you have a reasonably good way

of guaranteeing a certain level of purity and quality,

which is incredibly important if you're taking drugs.

And you can do so from the comfort of your own home,

without the risks associated with buying on the streets.

Now, as I said,

you've got to be creative and innovative to survive in this marketplace.

And the 20 or so sites that are currently in operation --

by the way, they don't always work, they're not always perfect;

the site that I showed you was shut down 18 months ago,

but not before it had turned over a billion dollars' worth of trade.

But these markets,

because of the difficult conditions in which they are operating,

the inhospitable conditions,

are always innovating, always thinking of ways of getting smarter,

more decentralized, harder to censor,

and more customer-friendly.

Let's take the payment system.

You don't pay with your credit card,

of course -- that would lead directly back to you.

So you use the crypto-currency bitcoin,

which is easily exchanged for real-world currencies

and gives quite a high degree of anonymity to its users.

But at the beginning of these sites, people noticed a flaw.

Some of the unscrupulous dealers were running away with peoples' bitcoin

before they'd mailed the drugs out.

The community came up with a solution, called multi-signature escrow payments.

So, on purchasing my item,

I would send my bitcoin

to a neutral, secure third digital wallet.

The vendor, who would see that I'd sent it,

would be confident that they could then send the product to me,

and then when I received it,

at least two of the three people engaged in the transaction --

vendor, buyer, site administrator --

would have to sign the transaction off

with a unique digital signature,

and then the money would be transferred.

Brilliant!

Elegant.

It works.

But then they realized there was a problem with bitcoin,

because every bitcoin transaction

is actually recorded publicly in a public ledger.

So if you're clever, you can try and work out who's behind them.

So they came up with a tumbling service.

Hundreds of people send their bitcoin into one address,

they're tumbled and jumbled up,

and then the right amount is sent on to the right recipients,

but they're different bitcoins:

micro-laundering systems.

(Laughter)

It's incredible.

Interested in what drugs are trending right now on the dark net markets?

Check Grams, the search engine.

You can even buy some advertising space.

(Laughter)

Are you an ethical consumer worried about what the drugs industry is doing?

Yeah.

One vendor will offer you fair trade organic cocaine.

(Laughter)

That's not being sourced from Colombian druglords,

but Guatemalan farmers.

They even promised to reinvest 20 percent of any profits

into local education programs.

(Laughter)

There's even a mystery shopper.

Now, whatever you think about the morality of these sites --

and I submit that it's not actually an easy question --

the creation of functioning, competitive, anonymous markets,

where nobody knows who anybody else is,

constantly at risk of being shut down by the authorities,

is a staggering achievement,

a phenomenal achievement.

And it's that kind of innovation

that's why those on the fringes

are often the harbingers of what is to come.

It's easy to forget

that because of its short life,

the Internet has actually changed many times

over the last 30 years or so.

It started in the '70s as a military project,

morphed in the 1980s to an academic network,

co-opted by commercial companies in the '90s,

and then invaded by all of us via social media in the noughties,

but I think it's going to change again.

And I think things like the dark net markets --

creative, secure, difficult to censor --

I think that's the future.

And the reason it's the future

is because we're all worried about our privacy.

Surveys consistently show concerns about privacy.

The more time we spend online, the more we worry about them,

and those surveys show our worries are growing.

We're worried about what happens to our data.

We're worried about who might be watching us.

Since the revelations from Edward Snowden,

there's been a huge increase in the number of people

using various privacy-enhancing tools.

There are now between two and three million daily users

of the Tor browser,

the majority of which use is perfectly legitimate,

sometimes even mundane.

And there are hundreds of activists around the world

working on techniques and tools to keep you private online --

default encrypted messaging services.

Ethereum, which is a project which tries to link up

the connected but unused hard drives of millions of computers around the world,

to create a sort of distributed Internet that no one really controls.

Now, we've had distributed computing before, of course.

We use it for everything from Skype to the search for extraterrestrial life.

But you add distributed computing and powerful encryption --

that's very, very hard to censor and control.

Another called MaidSafe works on similar principles.

Another called Twister, and so on and so on.

And here's the thing --

the more of us join,

the more interesting those sites become,

and then the more of us join, and so on.

And I think that's what's going to happen.

In fact, it's already happening.

The dark net is no longer a den for dealers

and a hideout for whistle-blowers.

It's already going mainstream.

Just recently, the musician Aphex Twin released his album as a dark net site.

Facebook has started a dark net site.

A group of London architects have opened a dark net site

for people worried about regeneration projects.

Yes, the dark net is going mainstream,

and I predict that fairly soon, every social media company,

every major news outlet,

and therefore most of you in this audience,

will be using the dark net, too.

So the Internet is about to get more interesting,

more exciting, more innovative,

more terrible,

more destructive.

That's good news if you care about liberty.

It's good news if you care about freedom.