US and Korean authorities used Bitcoin (BTC) tracking methods to bust one of the largest rings for the sale of child pornography, reported Bloomberg. The global crackdown charged 337 persons with darknet activity, and led to the indictment of Jong Woo Son, 23, for running a darknet site.
Jong Woo Son is already in custody and serving a sentence in South Korea. Among the 337 arrested are site users from Korea and the US, including law enforcement officers. The crackdown also led to the rescue of 23 minor victims in the US, Spain, and the UK, who were held against their will by site users.
The latest crackdown followed the practice of the website to assign addresses to users, and link an identity to their BTC wallets. In effect, the users indicted themselves, because of the attempt at user-friendliness, and did not manage to use BTC in a more confidential way. This led to the ease with which law enforcement tracked the network activity.
The Welcome to Video website held a database of the deposit addresses, which were then easily linked to user profiles and their other BTC holdings and a history of transactions. The network ended up holding indisputable evidence of the users’ connection to the WTV website.
The investigators have started a forfeiture procedure to seize the BTC held with 24 chief accounts, and use them as compensation to the darknet circle victims. The tracking of funds was one of the triumphs for the Chainalysis service, which has become increasingly important within the crypto space.
https://twitter.com/chainalysis/status/1184486796526153728
“We’re proud of the work done by law enforcement and that our products could support the takedown of WTV. Most importantly, we were able to help law enforcement free several children from their abusers and begin the long road of bringing hundreds of dangerous individuals to justice,” said the Chainalysis team.
The Bitcoin network remains pseudonymous only, and links between addresses are easily viewable. Chainalysis graphs show links between the WTV site and various mainstream crypto services, including leading exchanges. This further opens the question for the need of KYC based on blockchain analysis.
