The US government was the first to use blockchain technology to investigate and bring down a dark-web marketplace called the Silk Road, which sold drugs, weapons, and everything illicit on this planet.
The blockchain also helped nail two corrupt investigators investigating the black-market site.
Authorities often criticise bitcoins and crypto-currencies as enablers of crime as they give criminals anonymity and a way to bypass highly regulated financial channels. But the blockchains that power the crypto-currencies are now being mined by criminal detectives. The most famous case detected by using blockchain technology reads as an Agatha Christie thriller.
Silk Road was mysterious marketplace. Nobody knew who was behind it. All that the investigators knew was that he went by the username: DPR or Dread Pirate Roberts. Sometime soon, however, an undercover agent could become friends with DPR and the two began messaging almost daily. The undercover user name was NOB. In 2015, two Silk Road users namely Death from Above and French Maid began handing out threats to DPR informing him of exposing his identity if he did not cough up “hundreds of thousands of dollars, in bitcoins”. At the same time, French Maid was selling information on the federal investigation of Silk Road back to DPR. Around the same time, 21000 bitcoins vanished from Silk Road accounts and DPR through his own investigation figured out that credentials of a Silk Road administrator named Curtis Green had been used to steal the money. After the discovery, DPR approached NOB to kill Green. But Green by then had turned approver for the federal authorities and in their protective custody had handed over his computer information, including his Silk Road credentials.
Federal investigators still did not know who “Death from Above” or “French Maid” was and had no clue what had happened to 21,000 bitcoins. A God sent tip from one member of the crypto currency community occasioned the top Federal authorities to investigate their own agents investigating the case discreetly. When they looked into NOB’s accounts they found he was moving humongous amounts of bitcoins to his personal accounts. Blockchain makes the bitcoin possible. Blockchain tracks every bitcoin transaction. Blockchain’s audit trail with federal subpoena power, revealed that the bitcoin payments from NOB’s accounts were coming from the Silk Road. NOB was the owner of both French Maid and Death from Above. He was playing both sides all the time. Upon further investigation, the agents found that 21,000 bitcoins had gone to the account of secret agent on the task force investigating Silk Road. The agent had been in the room when Curtis was handing over his password. Both NOB and the secret agent had done a great job of concealing their criminality. Today, both are cooling their heels in the prison. Without blockchain, they would still be undercover agents.
Similarly, blockchain technology is today helping detection of crimes in new ways without face-to-face interactions. In a blockchain, we store data in blocks, linking each block in a chronological order in a line with a hash that forms a unique identifier linking the blocks together. We cannot alter data in a blockchain, we can only add it on to the chain with timestamps and no single stakeholder can control it as they distribute it over a large network of computers. This is basically an e-ledger. By using technology, it is now possible to keep tabs on and analyse transactions that we can connect to crimes and criminals. With blockchain technology we can make crime reports on a distributed ledger, through which we can automatically update the victim or the complainant every time there is a development in the case. This could even apply to cases under trial, where we can intimate warrants and summons to registered users in real time. Exchange or sharing of data between different law enforcement agencies or with different components of criminal justice system becomes simple helping multiple users to access the data with varying levels of permission.
Blockchain provides an unalterable chronological clandestine storage of records and documents by which police can analyse criminal activity. Further, the public nature of blockchain falls outside of potential third party doctrine issues. Blockchain therefore would not raise third party doctrine issues which revolves over anticipation of privacy over information one shares with the third party such as a bank or ISP. Hence, mobile records, internet history, transactions etc would become admissible as evidence in an investigation as the public nature of the blockchain would allow the police to access criminals using such technologies to commit crimes. Further, law enforcement and internet providers who have problems with keeping customer and transaction data could keep any quantum of data without needing to erase it.
Blockchain can also play several book-keeping roles like securing a chain of custody to inter-organisational data sharing and more. By which, it can free up enormous funds for more important aspects of police work. Samples of evidence collected during an investigation sometimes go missing or get disintegrated or get stolen or mishandled or get thrown away. Chemical Examiners Report in the sensational sister Abhaya case was found fudged. This brought to light the scowling verity of manipulation even in high-profile cases.
Though we may not physically store a blood-stained knife on the blockchain, it will be possible to document who handled the evidence and other critical information including the mode and method of storage. For preserving evidence, blockchain is extremely good for tamper-proofing records of origin and the chain of custody. The best thing about blockchain is that it is borderless. When evidence is within another country, we today have to seek permission from the host country to get that evidence. This issue won’t arise with blockchain because it can be available from anywhere. Despite several benefits of using blockchain, police and security agencies have so far only taken an interest in this technology, mostly for tracking criminals hiding illegal money from banks.
In Thiruvananthapuram, India a project called “Police 2020” is developing blockchain technology to help a variety of stakeholders collect, secure and access data in a decentralised manner. In Australia, AUSTRAC, the financial intelligence agency and the Australian Criminal Intelligence Commission has given a contract to Singapore-based consultancy Houston Kemp to build a blockchain based system to record intelligence and data generated by the police. China’s Ministry of Public Security, which deals with all Chinese police departments, has built a blockchain application to place evidence from investigations into cloud storage. Governments such as Telangana, in order to make land records tamper-proof are moving them to blockchain platform in a phased manner, while others are exploring ways and means of storing contracts and assets and the financial industry too is experimenting with blockchain technologies to streamline transactions and back office systems.
Blockchain despite having several advantages has some challenges. In a blockchain, it would be possible for criminals to protect their identities with high levels of encryption. There is also the danger of building a more decentralised internet like blockchain earth which would make it extremely difficult to monitor and remove content such as child pornography and material provoking terrorism.
That a thriving dark-net market place such as Silk Road marketplace even at the embryonic stage of crypto currency investigators could be brought down, reveals that law enforcement has developed an awe-inspiring capacity to analyse and trace transactions using blockchain. During the Silk Road investigation, blockchain revealed how the DEA agent Carl Force stole bitcoins despite trying to disguise its source and destination.
Crypto currencies are being depicted as an asylum for criminals as over $1.2 billion was being transacted on the now defunct Silk Road marketplace for over two and a half years. But cryptocurrency is a double-edged sword; cryptocurrency investors can be victims of theft and fraud. By the end of June 2018, criminals stole a reported $1.7 billion in crypto currencies in a year. That means that they could steal more than $4 billion in cryptocurrency in a year. Crypto-currency has also become the preferred currency for demanding ransom payments. In January 2017, hackers started aiming at open source documents, programs, wiping out data deliberately and demanding ransom for restoring the data. In the new world of crypto-currencies traditional strong-arm methods of crime have made their way too- A robber relieved a man of his USB drive containing $1.7 million investments in crypto currencies at gun-point. Despite such crimes, law enforcement still appears to give precedence to likes of ISIS, cartels, etc which use crypto to launder money.
Ransomware attacks have become very common. For instance, a person may receive an email informing him that somebody has locked his files with encryption, which he won’t release unless he pays a specified ransom. Such criminals 75 percent of the time make a ransom request only in bitcoins. Such attacks have become so pervasive that the US Department of Homeland Security (DHS) funded the development of a bitcoin analysis tool specifically aimed at ransomware. Whether the victim pays up the ransom or otherwise, the FBI has devised ways to peg the perpetrator of the attack. Established in 2000, the FBI’s Internet Crime Complaint Center (IC3) admits reports of alleged cyber crimes including theft of intellectual property, corporate infiltration and “online extortion” or ransomware. The FBI looks into the recipient wallet and its expenditures and tries to find connections to other wallets or clusters of addresses. When it comes across something suspicious, it serves a subpoena to learn what the transactions have been paying for. This in most cases has been leading to the identification of the ransom recipient.
In the end, a blockchain is like human consciousness. A blockchain is distributed so is human consciousness. Each human within the network of human consciousness is a distinct node that can act individually or in concert with the collective consciousness. An individual’s consciousness will advance spiritually only if it aligns with the other spiritual beings and their consciousness nodes.
(Dr Jayanth K. Murali, IPS, is ADGP (L&O) Tamil Nadu. He is an avid marathon runner and figures in two entries in Asia Book of Records. The author can be contacted at www. jayanthmurali.com)...