Tracers in the Dark: The Global Hunt for the Crime Lords of Cryptocurrency

Tracers in the Dark: The Global Hunt for the Crime Lords of Cryptocurrency by Andy Greenberg

Bitcoin and cryptocurrency rose as a means of making financial transactions in anonymity. Criminals have used bitcoin as the currency of choice for illicit transactions. However, the record is on the blockchain. People have been able to analyze the blockchain to help identify the transactions. This has lead to further attempts to anonymize transactions, which has lead to further attempt to trace.

This book follows a few major "busts" of dark web marketplaces and the people that have helped identify activity on the blockchain. Some of the identification was based on concepts from the initial blockchain whitepaper. Others remain "proprietary". There are a number of mathematical and problem solving skills needed to identify transactions. Leads and lucky breaks can also be helpful. Researchers will also set up accounts and transfer money within various exchanges to see how they record transactions. They have even attempted to create their own blockchain recorders to get details. (Though this has also backfired when it has gone wrong.) Often they can identify a mistaken leak of information in the online profile (such as the one time they accidentally sign with a true name, or forget to pass their IP through an anonymizer.)

The bulk of the  novel covers the "busts" of various criminals. There were some government figures that had stolen from the bitcoin markets they had infiltrated. Then there were attempts to crack down on the dark web marketplaces like Silk Road. The government used various mechanisms to tie the players to the marketplace. They also tried to track down missing bitcoin from other exchanges. This proved valuable in taking down other parts of the dark web. Even the most careful hackers had an occasional slip up. There were busts in the Netherlands and Thailand, with the Europeans operating a dark web marketplace for a few weeks and thus busting a number of individuals (and scaring many others.) Russians are among the most difficult to trace due to their government not cooperating. 

In addition to tracking the hackers, the blocktrain tracing has been used to trace users of blockchain. A child-abuse ring based on a South Korean's computer was brought down via transaction tracing. 

The hackers continue to fight back. There are more secure means of making block chain transactions. However, these have added expense (in time and money.) What will be the result of the blockchain arms race?