|Current Status:||Offline (as of Dec 2013)|
Sheep Marketplace was an anonymous marketplace set up as a Tor hidden service. It operated for less than a year, from March to December 2013, when it announced it was shutting down after a vendor stole $6 million worth of users' bitcoins
Bitcoin Theft Incident
In December 2013 Sheep Marketplace announced that one of the site's vendors exploited a vulnerability to steal 5400 bitcoins, valued at about $6 million. According to Forbes, and The Guardian several suspicious users reported the site had started to block withdrawals of bitcoins more than a week prior to the theft. Users furthermore suggested the site's administrators held far more than 5400 bitcoins, pointing to records of a coincidental transfer of almost 40,000.
Victims of the theft have attempted to identify the thief by sending "tagged" bitcoins to his accounts, using the public nature of bitcoin transactions to follow these moneys through the "blockchain" record of transfers. Within a couple days of the theft, a large amount of bitcoins were noticed being processed by Bitcoin Fog, a "tumbler" used to launder bitcoins by shuffling them between many accounts for a small fee. The size of the transaction, 96,000 bitcoins, caused Bitcoin Fog to fail, leaving the money traceable. Not long thereafter, the identity of the user that had been presumed to be the thief was found to be BTC-E, a large bitcoin currency exchange.