Law enforcement officials say tracked Bitcoin transactions to take down “the largest child sexual exploitation market by volume of content.” It’s a reminder that criminals who think Bitcoin is a foolproof way to cover their tracks are mistaken.
The news: US federal prosecutors have indicted 23-year-old Jong Woo Son of South Korea for operating a child sexual abuse site called Welcome To Video. In addition to Son, 337 of the site’s users—residing in the US and 11 other countries—have been arrested and charged.
Crypto-sleuthing: Users of the site traded Bitcoin for illicit content. Each new user would get a unique Bitcoin address. Special agents from the Internal Revenue Service’s criminal investigation unit used Bitcoin surveillance techniques to track down the site’s server’s physical location in South Korea. An analysis of the server found that more than one million addresses were associated with the operation, according to the DOJ.
Bitcoin is not anonymous. It’s long been possible to track the flow of illicit crypto-money by applying sophisticated analytical tools to public blockchain data. Law enforcement officials can combine these with real-world clues to connect dots and even de-anonymize users.
—Mike Orcutt
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