Posted on 02/05/2018 12:56:19 PM PST by nickcarraway
When bitcoin was first introduced, one of the concerns was that it was being used as a form of payment for questionable and/ or illegal transactions, such as those on the now-defunct marketplace Silk Road. The reason it was so popular for such transactions was because it provided an untraceable way to pay for items, but that seems to be changing.
Researchers recently discovered that they were able to unmask some dark web users by linking them to bitcoin wallets that were used for transactions on the dark web. As a result, the anonymity once offered by bitcoin seems to be coming to an end, at least for those conducting transactions via the dark web.
dark web bitcoin geralt / Pixabay Researchers identify dark web uses via bitcoin The dark web is basically the part of the World Wide Web that casts a shadow over users’ activities. Certain software is required to hide one’s traffic on the Internet, and the dark web consists of parts of the World Wide Web that search engines do not index. Small peer-to-peer networks and larger networks such as Tor make up the deep web, and it was Tor that was the area of focus for researchers at Qatar University and Hamad Bin Khalifa University in Doha.
This week they revealed the findings from their recent study of bitcoin transactions on the dark web. They were able to identify about 125 different users by linking them to their bitcoin wallets. They did this by connecting payments made in bitcoin on a website in the dark web to the user’s public account. They found it very easy to make these connections in over 20 different cases on Silk Road, which was shut down a few years ago by U.S. authorities. The researchers were even able to link buyers’ names and even their locations with the bitcoin transactions.
Israeli startup monitors bitcoin transactions on the dark web The same week the Qatar researchers revealed their findings on bitcoin use on the dark web, an Israeli startup is spreading details on the tool it built to do the same thing. Webhose management told Independent.ie that their new Dark Web product has enabled them to expand their client base to include cyber-security groups, money laundering firms and law enforcement agencies. Their feed runs on the Tor network and covers millions of webpages.
The company explained that although there is some legal content, it also contains a lot of “illicit marketplaces” offering sales of drugs, illegal porn, identity, fraud, weapons and credit card information. Webhose cofounder Ran Geva even said that bitcoin users are posting their bitcoin wallet and cryptocurrency transaction details on message boards on the dark web, making it very easy to track them and their identities.
Users have already been shifting from bitcoin It should come as no surprise that dark web users who want to hide their online activities for more reasons than just basic personal privacy would be the first to realize that bitcoin’s anonymity had been severely compromised. A recent analysis revealed that such users have already been switching from bitcoin to newer cryptocurrencies, such as monero, Zcash and dash.
Chainalysis, a forensics firm, reported recently that only 1% of transactions completed on the dark web is conducted in bitcoin, a sharp decline from the 30% of transactions that used to be conducted in bitcoin. Chainalysis also picked up a sharp increase in the use of monero there.
Bkmrk.
I never understood how Bitcoin is supposed to be so anonymous. WE all leave a footprint on the internet, so I’ve always heard. So why would a Bitcoin transaction be any different?
Also wouldn’t any other cryptocurrency have the same problem?
If the whole point of crypto-currencies, anonymity, is an illusion, I’d expect its value to drop to zero. Because while precious metals are a barbarous relic as stores of value, they do have practical uses both in industry and for ornamentation. Whereas crypto-currencies without secrecy are just an elaborate Ponzi scheme.
I’ve heard that if you own bitcoin and watch porn, the feds are going to raid your house and tell your wife and your MOTHER.
It’s true, I think I read that on the internet.
The future is obviously Bitcoin hawala.
“Also wouldn’t any other cryptocurrency have the same problem?”
You call it a ‘problem’. The NSA calls it a ‘feature’.
FYI, most US dollars exist as a highly traceable cryptocurrency and not as actual cash.
It’s just a public ledger showing bitcoin amount transfers.
You keep your bitcoin in a public digital wallet.
This article is saying you can sometimes trace transactions in the ledger to specific wallets.
There are actually bitcoin anonymizer services to help maintain anonymity, but even they are not foolproof, especially when large quantities of bitcoin are involved.
https://btcmanager.com/zerolink-bitcoin-anonymizer-service-going-live-soon-test-participants-get-10/
“I’ve heard that if you own bitcoin and watch porn, the feds are going to raid your house and tell your wife and your MOTHER.
It’s true, I think I read that on the internet.”
How did your wife and mom take the news?
(-;
When will the DOJ or the IRS take Bitcoin down? Was it created by the Obama Administration to pay off ISIS or Iran. Did the US Gov create it to pay off drug producers? Gun Runners? who is behind it.
No surprise - whether connected or not, does anyone think that governments are going to turn a blind eye to this avenue of financial exchange? After all, the amount of revenue governments are missing out on via taxes is growing. Further, how much money do they see as being “laundered”?
One can't help but wonder if arms manufacturers aren't benefitting from bitcoin shielding the transfer of goods. Also, what about governments and corporations that transferred wealth to ISIS?
I'm deeply suspicious of the motives of governments, globally, for allowing bitcoin to last this long. One can't help but think that shielding certain transactions from public scrutiny was more important than was tax revenue which was lost.
Anything digital and somebody can find you, if they are motivated enough, skilled enough, and really need to find you.
Those in crypto-currencies know and have known that Bitcoin is only kind of anonymous. It is anonymous until someone starts digging into the origins of the transaction. (ATM they used, time, date, etc. to purchase it).
Now other more anonymous coins have been developed.
Anonymity is only one benefit/use of crypto. There are others (no permission needed by government to use it, global, distributed (not centrally controlled).
Crypto is like the internet in the 90s. It will change things considerably but it may still be a few years off.
Block chain is public. The IRS hired a firm that mines the owner’s info - for US citizens...
Bitcoin is pseudoanonymous, but with chain analysis, there is effectively poor anonymity.
For truly private transactions, one would transact with Monero, which uses ring signature, or Zcash, which uses zero knowledge proofs. You would send the transaction via TOR and/or VPN, on Tails.
If anyone finds Satoshi Nakamoto, the creator of Bitcoin, who interacted solely by the web and by email, that person will be a hero. Many have tried but Satoshi remains anonymous. He knew how to keep private on the internet. Bring in the NSA, maybe, but barring that, no luck so far.
Artificial intelligence created Bitcoin/Blockchain.
Google: Singularity
The “whole point” of Bitcoin is hardly anonymity. The crucial features are:
1. Decentralization. No bank or corporation or government “owns” Bitcoin beyond whatever amount they are willing to buy. There is no central point of control which can “turn off” Bitcoin or stop people from exchanging it, short of taking down the entire Internet and power grid.
2. Accountability. Every transaction is engraved in the blockchain and there it remains immutable for all time.
3. Immune to confiscation. Not being a physical item, there is nothing to steal except information. If you keep your private key (a string of characters) completely to yourself, you keep your Bitcoin no matter what.
4. Limited supply. There can never be a supply of Bitcoin above a definite limit of 21 million. At the moment roughly 17 million have been mined. The mining algorithm becomes ever more difficult as the overall supply increases. A Bitcoin cannot be produced without a significant investment in hardware and electrical power. Consider the contrast with fiat money, which has unlimited supply and costs less than zero to mint, because of interest paid on fiat newly produced by debt generation (a loan).
The bottom line is that Bitcoin and other cryptos are a more advanced medium of exchange which can only exist in a computerized society. They have attractive features (see above) which are not possible with fiat or PM. Owning Bitcoin is basically placing a long term bet that the best form of money will eventually win out and prevail.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.