Inside the Takedown that Shredded the Myth of Bitcoin’s Anonymity
The coin which changes the perception of the digital world, now changing the thinking of people that the transactions are not untraceable and the Intelligence Agency is keeping eye on these transactions.
The untold story includes connections to suicide and child abuse which shredded the myth of Bitcoin’s anonymity.
In the fall of 2017, Chris Janczewski was standing inside the doorway of a home when the Homeland security Investigations agents swarmed inside and started searching the premises for evidence and seizing the electronic devices.
The agents released the father from the rest of the family and started investigating the father in one room and his wife in another room. The kids are shifted to another room and the agents switch on the TV in an attempt to distract the children from the investigation.
Janczewski was the part of the investigation but only as an observer as he was the one to bring agents to the house. Janczewski followed the links of Bitcoin’s Blockchain which connected the home of the assailant to an extraordinarily cruel place on the internet and further connected that place to hundreds more men around the world who now are the targets of Janczewski.
It was Janczewski and Tigran Gambaryan along with a group of investigators who indulged in tracing a cryptocurrency that once seemed untraceable which lead to cracking one criminal case after another on an unprecedented scale. But this case becomes the proof of their concept. Janczewski was standing at the front door when he heard the Homeland Security agents speaking to his father who is responding in a broken voice and his wife was in another room saying that she had found the certain image on her husband’s computer but he told her that it was downloaded by mistake while pirating music.
At the moment of investigation, Janczewski thinks that the father of two was a high school administrator and whether he is guilty or not, the mere presence of the investigator has almost ruined his life. The investigation has blown the cover of a hidden layer of illicit connections underlying the visible world.
The South Africa born tech entrepreneur named Jonathan Levin always visits the Uk’s National Crime Agency which is equivalent to the FBI for getting feedback on the software his company has made. The software is made to trace cryptocurrency by the world’s first tech firm ChainAlysis.
Thus NCA was one of the dozens of law enforcement agencies around the world that had learned to use the Chainalysis software to turn the digital underworld preferred means of exchange into its Achilles heel.
The fundamental premise of the cryptocurrency was that it revealed only which coins reside at which Bitcoin addresses as a long unique string of numbers and letters without any identifying information about the owners of the coins. This information created the impression among the people that Bitcoin might be the fully anonymous internet cash awaited by libertarian cypherpunks and crypto-anarchists. This led to a financial netherworld where digital transactions full of unmarked bills could change hands across the globe in a minute. The companies like Silk Road, a major user of the dark web are using Bitcoin as their central payment mechanism. But the tech company Chainalysis has given assurance that its software captures every bitcoin payment in the Blockchain which is a permanent public record of the transaction taking place in the Bitcoin network. Bitcoin assures that coins cannot be forged. But companies like Chainalysis are working continually to tear the gaping holes In the masks separating Bitcoin users’ addresses and their real identities.
The intelligence agency traces the criminal by having a transaction with them or by tracing Coins to an account at the cryptocurrency exchange where financial regulations require to disclose the real identity.
Chainalysis works like tracing the addresses of dozens of millions of people or many addresses belonging to one person. Thus, when coins from two or more addresses were spent in a single transaction, the software gives the warning of a multi-input transaction. Another method used by Chainalysis is to use a peel chain that tracks a single was of cash that the user repeatedly pulled and put in different spots. This situation helps the investigators to follow a sum of money hopping from one address to the other through the noise of Bitcoins Blockchain. By 2017, agencies like the FBI, Drug Agency, and IRS had traced Bitcoin transactions with the help of Chainalysis.
Investigators had traced the transaction of two corrupt federal agents as well as traced the transaction of the Silk Road. The investigators also tracked the billion dollars stolen from the Mt.Gox exchange and succeeded in showing that it was laundered by the Russian administrator of another Crypto exchange.
Child pornography was trafficked on Welcome to Video has increasingly come to be called Child sexual abuse material by the child advocates and law enforcement.
These websites are used by millions of people around the world, those who are seeking to avoid online surveillance are using these sites to transact money without coming into the eye of people.
Thus there are several software and companies which is focused to track the transaction on the dark web and other people who are in the world of crimes and want to earn money under the table.