It is now becoming harder for criminals to carry out their illegal deals with experts coming up with new systems which have improved surveillance. Denmark had shown that cyber criminals who deal with cryptocurrency can be found and convicted. A Danish newspaper has revealed that the Danish police’s cyber crime unit (NC3) has set a record for being the first police unit to be able to arrest two drug dealers from the darknet. They have been able to do this by following their bitcoin transactions and using that information as evidence in court. The cyber crime unit built a system to follow up on the dealer’s transactions. The system is now being used by other agencies such as Europol and the FBI.
Early this year, the police were able to convict a dealer who was found mailing purchases of large amounts of cocaine, ketamine and amphetamines on Silk Road 3 using bitcoins. This enabled the police to trace him. The 20-year-old was found guilty and was sentenced to eight years in jail by the Court of Herning, Jutland.
According to Kim Aarenstrup who is the lead of the cyber crime unit, “The police cyber crime unit here in Denmark is one of a kind since no other country has been able to use bitcoin transactions as evidence against criminals like we have done to convict them”. He adds that “Most countries are now looking up to us when it comes to fighting cyber crimes. They are now contacting us on how to develop this system.”
Aarenstrup warned the dealers behind darknet marketplaces that they should be careful now that the police are able to trace them. He publicized the newly acquired system in order to discourage drug dealers and other illegal dealers on the web.
End of Bitcoin Anonymity?
Jesper Klyve, the prosecutor of the two cases on online drug dealings said that bitcoin was the main evidence used against the accused. He said that using bitcoin currency for transactions is not illegal but that the fact that many illegal dealings are done using this currency is undeniable. Bitcoin is widely known for illegal dealings such as sell of weapons, extortion business and sells of illegal drugs. He added that the darknet and bitcoin have helped the drug dealers since it has been hard for them to be found but with this new system established by the Danish police, he is optimistic that things will change.
The Danish police cyber crime unit has revealed very little on how their system works. The system looks at the transaction information related to the purchase made and compares it to the bitcoin dealers and customers on the main darknet marketplaces. The blockchain technology behind the use of bitcoins makes the transactions visible. Those using bitcoins can be identified since they leave traces of themselves behind. Before buying bitcoins online, one is required to send a form of identification that can be used. One is also required to have a bitcoin wallet which also requires an address both of which are anonymous. However, all the transactions using bitcoins are coded into the blockchain which bitcoin uses. The blockchain is a ledger of every transaction that occurs and is available to the public hence making it easy for these transactions to be traced. The comparison will help the cyber unit to be able to notice transactions that seem questionable and also identify the consumers involved in it.
The case revealed that the drugs were sent through postal service after bitcoin transaction had happened. Klyve insists that even if a suspect has denied receiving mail of drugs which he denies, the system is able to check whether there was any recent bitcoin transaction that he or she recently had been involved in. All bitcoin transactions are normally coded into the bitcoin system and one can follow up on the individuals behind every transaction.
Most governments around the world have been restricting transactions using bitcoin due to its anonymity but the Danish unit has proven that those dealings can be traced using proper equipment, sufficient time and deep knowledge of the darknet. The criminals definitely enjoyed the introduction of the use of bitcoins in 2008 since the police could not be able to monitor the exchange but now Denmark has definitely shown that the darknet marketplaces are now no longer safe for criminals to do their dealings. Some marketplaces like AlphaBay are actually legitimate sites with a robust system that discourages illegal trade. With more development of this system and increased involvement from other parties, this system should be able to control the crimes taking place in the darknet marketplaces.