Sandia Research is being backed by the U.S. Government in the creation of a tool that will help law enforcement de anonymize bitcoin transactions.
Bitcoin is becoming all but mainstream these days, with more and more businesses and entities all over the world accepting bitcoin as a method of payment. People even work, and get paid in Bitcoin. With the gain in popularity, it’s no wonder that law enforcement would want to be able to link bitcoin transactions to a physical identity, rather than a stream of numbers and letters. While Bitcoin is not very hard to use, it is extremely hard to fully understand the technology that drives this ever growing, ever expanding cryptocurrency.
Law enforcement is going to be setting its sights on more illegal operations, opposed to your everyday, law abiding citizen’s daily transactions.
Andrew Cox, lead researcher for Sandia said that the teams job is to understand how bitcoin works. He noted that the semi-anonymous currency could very well change the face of transactions for the benefit of the national economy.
In a blog posted by Sandia National Laboratories, Cox stated that, “It has been clear that criminals have been pioneers in using bitcoin. The use it for drugs, for guns, child pornography, and all sorts of terrible stuff.”
In fact, this is why Sandia has conducted research backed by the U.S. Department of Homeland Security. They hope to set up a graphical interface for users so that law enforcement, as well as other agents will be able to test the algorithms that they utilize in their real time investigations.
“This will allow us to adjust what we’re doing to make sure we’re being of maximal use to them,” the blog went on to say.
The amount of time and resources needed is what law enforcement agencies claim are slowing, and even halting investigations. The rate of growth of bitcoin has caused law enforcement to fall behind in technology. They simply do not have the tools in place to encounter the problems they have tracking these cryptocurrency transactions.
Cox has stated that Sandia needs to understand the numerous patterns that bitcoin transactions might make. By looking through past investigations to figure out other configurations Sandia, and Cox hope to achieve this. He was more than willing to admit this is no easy feat.
“There is no ‘silver bullet’ algorithm to effectively de-anonymize bitcoin,” Cox stated further in the post.
Sadia has been conducting research on illegal businesses that focus on bitcoin. They do this by conducting experiments with other algorithms that can de-anonymize illegal cryptocurrency users. They are focusing on those investigations that have ended successfully for law enforcement.
One the transaction is de-anonymized, law enforcement will be able to trace the bitcoin addresses to the owner, providing them with the information they need.
“It doesn’t mean that we get their actual name because there aren’t any names associated with bitcoin, but it will show that some transactions are being controlled by the same user,” Cox stressed in the blog.
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“Law enforcement is going to be setting its sights on more illegal operations, opposed to your everyday, law abiding citizen’s daily transactions.” Oh well then there’s nothing to worry about then because legality equals morality, right?
Integrate an overnight gov policy as a “counter measure to stopping terrorism” specifically with US based merchant processors and wallets like CB. Require a mild cocktail of Paypal’s Merchant verification & dating sites style of verifying free users. Specifically the social media/cross reference with a selfie shot and face reg prog. Integrate a back-end script into wallets & web cookies to pull the device’s IME and cross reference with telecom/isp providers db’s as secondary measure. Insensitive domestic exchanges to comply in exchange for a fee per verified and delivered user file, and substantial tax breaks for the co and anyone who has a say in anything. Threaten foreign based web wallets/exchanges with nation wide blocking if they don’t comply.
Or skip all that and get just one nation wide US bank to offer btc over the counter, like Wells for example, and then every domestic service/exchange/wallet/merchant processor will eventually comply with admonitory client SS verification as well. Then bring CC scores back to crypto users and kill the last pretty thing BTC had to offer. Expand on security protocol dev via block chain dev within current fintech & cyper sec sectors and justify funding as a measure to counter act foreign cyber attacks on fortune 500 co’s. 18-24 months if you do it right. Thats my two satoshi on the matter. If you could mix Trump in there somehwere for a PR spin it would kick things off.