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A Korean operator (23) of a big child porn website got busted last year by U.S. and South Korean authorities. Although the arrest was already made in March 2018, 337 pedophiles around the world have been caught since. How? Simply tracing bitcoin transactions sufficed, Bloomberg reported recently.
The website called Welcome to Video reportedly distributed more than 1 million videos and incentivized users to contribute content. It operated on the Darknet part of the internet. The operator, Jong Woo Son, is now serving a 18 month sentence. Since his arrest law enforcement agencies have been able to connect his website with buyers and suppliers in over 38 countries. The break-through that helped making these connections proved bitcoin, which (to the criminals’ regret) is a fully transparent network for pseudonymous, and thus not anonymous, transactions.
Adding to the evidence that bitcoin is not a viable option for criminals, this story proves that bitcoin transactions can prove extremely helpful in tracking criminal activity. The busted website accepted payments in bitcoin for exclusive features on the elicit website. After apprehending the owner, officials were able to locate his bitcoin address and therefor identify all addresses it ever transacted with. Cross-referencing this with addresses known to deposit bitcoin into cryptocurrency exchanges (which are largely KYC compliant nowadays) yielded the massive international operations.
What’s more, in total 23 victims have been rescued since the bust in March 2018 who were actively abused by users of the site. In total 45% of the videos of Welcome to Video contained new images that were not previously known to the U.S. National Center for Missing and Exploited Children which actively searched for missing children.
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Wim Maas is a lecturer at the Department of Accountancy at Tilburg University, The Netherlands. His interests include the implementation of distributed ledger technology for financial accounting and reporting purposes.