Pipeline Investigation Upends Idea That Bitcoin Is Untraceable
Nicole Perlroth, Erin Griffith and Katie Benner report, in The New York Times, on how the Justice Department traced and recouped a huge ransomware payment:
Bitcoin is also traceable. While the digital currency can be created, moved and stored outside the purview of any government or financial institution, each payment is recorded in a permanent fixed ledger, called the blockchain.
That means all Bitcoin transactions are out in the open. The Bitcoin ledger can be viewed by anyone who is plugged into the blockchain.
Bitcoin was never really anonymous. It is pseudonymous, so it makes sense that transactions can be traced to some extent and tied to a unique owner or wallet.
What is interesting is not just that law enforcement can identify which Bitcoin wallet was involved in the fraud, but also that law enforcement could also crack the wallet’s password and retrieve/steal the money out of it. I wonder how. Was it a weak password? Was it social engineering? Was it a brute-force password crack? If so, was it cracked by a normal computer or by a quantum computer that no one else knows about?
Bitcoin seems fundamentally broken to me. I won’t touch it.