Cryptocurrency’s Myth of Anonymity | WIRED Leave a comment

Lauren Goode: Oh, after I purchase one thing with cryptocurrency, like after I go as much as my morning espresso store and I open my MetaMask and I’m like, “Hey, do you guys take BTC or ETH or GoodCoin?”

Michael Calore: Yes.

Lauren Goode: No, I do not do any of that, and I actually have not thought an excessive amount of in regards to the nameless prospects of this, though I do know that is a giant half of cryptocurrency, proper?

Michael Calore: It is. The prevailing thought is that, in the event you use it, individuals would not actually know what you are shopping for or how a lot you spent or that you just even participated in a transaction within the first place, however that’s really type of a fable.

Lauren Goode: Interesting.

Michael Calore: Yes. Do you need to hear extra about it?

Lauren Goode: I undoubtedly do.

Michael Calore: Then let’s carry on our visitor.

[Gadget Lab intro theme music plays]

Michael Calore: Hi, everybody, and welcome to Gadget Lab. I’m Michael Calore. I’m a senior editor at WIRED.

Lauren Goode: And I’m Lauren Goode. I’m a senior author at WIRED.

Michael Calore: We are joined this week as soon as once more by WIRED senior author Andy Greenberg. Andy, welcome again to the present.

Andy Greenberg: Thanks to you each for having me on once more.

Michael Calore: It’s nice to have you ever again. We’re speaking about cryptocurrency once more on at this time’s present, but it surely’s not likely in the best way that you just may count on. Andy, on the finish of final yr, you printed a e-book. It’s known as Tracers within the Dark. It’s crammed with tales about investigators who’ve been capable of observe down criminals by learning their cryptocurrency transactions. These are individuals who operated on the darkish net, locations like Silk Road, AlphaBay, and Welcome to Video, a web site the place customers shared baby intercourse abuse movies. These legal enterprises have been funded and fueled by cryptocurrency, primarily bitcoin. Now, since bitcoin has existed, individuals have been utilizing it to purchase and promote all kinds of authorized and unlawful issues on-line. They could not see that conduct as dangerous in the event that they’re doing one thing unlawful, as a result of they’re working underneath the belief that bitcoin transactions are untraceable. Now, that is by no means actually been true, however that perception has persevered anyway. Andy, this fable of anonymity round cryptocurrency is a working theme in your e-book. How did this fable come to be?

Andy Greenberg: Well, I’ve to confess that I’m in some sense a component of it, Mike. I wrote the primary print journal piece about bitcoin in 2011—fortunately, in some sense, not for WIRED journal. I labored at Forbes journal on the time. I lined this world of anonymity and hackers and surveillance, and I stumbled on this new phenomenon. Bitcoin was described to me as a form of untraceable, nameless digital money for the web. I used to be speaking with some of the primary bitcoin builders, and even Satoshi Nakamoto, this mysterious creator of bitcoin, had written on this electronic mail to a cryptography mailing record that, amongst different issues, members will be nameless on this new cryptocurrency world that she or he or whoever they’re was describing. So I wrote this primary piece in 2011, and I did describe on this Forbes piece how this appeared to be a form of untraceable digital money. You might put unmarked payments in a briefcase and ship them throughout the web to anyone with out revealing your id in the event you have been cautious, it appears. Of course, I instantly additionally was imagining, simply being the type of reporter I’m, that this was going to unlock an entire world of cash laundering and on-line drug offers and, I do not know, terrorist financing. All of that, in some sense, did come to go over the next years as a result of it did appear … And it wasn’t simply me. Even Satoshi Nakamoto believed that bitcoin and cryptocurrency extra typically, as there turned extra flavors of cryptocurrency, had these nameless properties. It was solely, I might say, not less than fast-forward an entire decade, round 2020, that I began to understand how fully flawed I used to be about this. How not simply I used to be slightly bit flawed, however really 180 absolutely reverse of right about this—that bitcoin is definitely absolutely traceable. In truth, it’s a lot simpler to observe the cash in the event you can crack and decipher the blockchain with cryptocurrency than even with conventional finance. It was really after I began to see the Department of Justice credit score this one firm, Chainalysis, which is a cryptocurrency tracing agency, in a single announcement after one other, I began wanting into this world of investigators who had figured this out a lot sooner than me. I noticed that this small group of detectives had discovered to hint cryptocurrency inside legislation enforcements in lots of circumstances, and had used this to take down one large cybercriminal operation after one other during the last 10 years. That escalating spree of large busts and takedowns is the story of this e-book, Tracers within the Dark.