Blockchain is a fundamentally totalitarian technology. It keeps track of every transaction ever made. Some crypto-currencies are better than others, but Bitcoin isn’t particularly anonymous.
Researchers at Qatar University and the country’s Hamad Bin Khalifa University earlier this week published findings that show just how easy it may be to dredge up evidence of years-old bitcoin transactions when spenders didn’t carefully launder their payments. In well over 100 cases, they could connect someone’s bitcoin payment on a dark web site to that person’s public account. In more than 20 instances, they say, they could easily link those public accounts to transactions specifically on the Silk Road, finding even some purchasers’ specific names and locations.
The researchers point out that they used only easily spotted addresses and simple matching techniques. They didn’t exploit, for instance, methods that other researchers have proposed for making less obvious connections between bitcoin addresses that identify “clusters” of addresses associated with dark web black markets. Nor could they use the means available to law enforcement to compel online services like the popular bitcoin wallet company Coinbase to cough up secret bitcoin addresses. “Our analysis shows a lower bound of what can be found,” Boshmaf says. More well-resourced and motivated hunters could potentially trace even more would-be anonymous bitcoin spenders, even years later.
The most anonymous technology for making untraceable purchases is known as “cash,’ which is why multiple countries are moving to phase it out (India being the largest), making it difficult, in particular, to make large purchases. Even places like the US and Canada, with their 10K reporting limit, haven’t raised that limit in decades, while inflation has made 10k a smaller and smaller amount of money.
Blockchains are far easier to use for totalitarian purposes than for non-totalitarian purposes. If you intend to use them for anonymity you MUST have done the necessary research into how to do so.
In general, using the internet for anything you want to remain private is dicey. The internet is not set up for it, and most powerful private and public actors in the world don’t want you to have any privacy. Understand this in your bones: What you do online is tracked, it is hard to make it anonymous, and it is often stored for long periods, so even if they can’t track it today, or choose not to, if you become of interest or techniques change, everything you’ve done online, now for decades, may turn into an open book.
This is becoming true offline as well, with the rise of surveillance cameras, often equipped with audio and permanent storage, combined with biometrics and pattern matching. The new AIs, while they aren’t going sentient, are extremely good at this sort of activity.
Still, offline is a harder problem, cash transfers are easier to conceal and harder to track, if you’re smart.
Know this, understand this, and act on this politically. Anyone who wants to remove cash is the enemy of anyone who values freedom. Anyone who wants blanket surveillance is the enemy of freedom.
There are no exceptions to this. This is law, natural law. Learn it in your bones, and use it to recognize the actual enemies of freedom.
Align yourself as you choose, but understand that the big killing and oppression is generally done by large actors, not by lone predators from whom government promises to protect you.
Government is a great slave. But as a master, it is a terror. If you don’t control your government, someone else will. And right now, someone else does.
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