In this way, if we come across Bitcoin or Litecoin addresses in an alleged criminal activity, we can trace the operations back to those which have been found involved, as well as navigating forwards or backwards in time in the block chains. At the same time, we should also get to know the internal history of this cryptocurrency, as if a hard fork has been produced it could be spending these bitcoins in different block chains under different rules. An example of this is the investigation which we published a few weeks ago about the Wannacry addresses tracking the clues through both the Bitcoin and Bitcoin Cash block chains.
So what should we do if during the course of the investigation we end up finding ourselves with a cryptocurrency which we do not have under our radar or which we do not know? Well firstly, most of the time, we will search in Google. However, the Coinmarketcap.com project could be used as a first reference, as it can further provide information about the average rate, which includes official websites of the project and some explorers from the block chain of each cryptocurrency.
|Figure 1. Information provided by coinmarketcap about Bitcoin Cash|
Even if it were so, it is recommendable that the generation of different addresses follows the recommendations of the Bitcoin community. In this way, the person who we pay will not have information about the total quantity of money which we have when we make a payment; as it could be the case that we had our entire fortune within the same address. In the end, when we pay a business in cash we do not have to say to the person we pay how much money we have in the bank, we only pay them the right quantity to cover the product amount. Thus, it is precisely within this possibility of generating numerous addresses where the anonymity of Bitcoin resides. From there came the emergence of services called mixers which are dedicated exclusively to carrying out this operation. If the balance of the addresses starts to circulate between dozens of addresses, it is difficult for an external observer to be able to establish where the money has changed hands, by having merely the information from the blockchain.
Dash emerged in 2014 and it is based upon the Bitcoin source code. It relies upon two types of nodes, nodes (miners) and master nodes (in charge of governance and extra uses such as instant and anonymous submissions). The last ones are special nodes ordered to execute certain specific functions which are inherent to cryptocurrency:
- PrivateSend. A difference from Monero, is that the anonymity in DASH is optional. The transactions are routed through the masternodes in a similiar form as a mixer. The maximum quantity which you can send by this method is 1000 DASH.
- InstantSend. In other cryptocurrencies it is necessary to wait for a transaction to be added to the block. With this functionality its purpose is to speed up the process if there is consensus among the masternodes.
|Figura 2. Ejemplo de explorador de Monero.|
Even so, you must not lose sight of the fact that carrying out connections with network nodes from these cryptocurrencies can be an indicator of their use. For this reason, and also from being experts, we can say that the transaction anonymity is not sufficient to generate a completely anonymous payment, the main developers of the Monero project are also working on a project destined to improve the privacy at a network level. Based upon the i2P and known as Kovri (in Esperanto, to conceal or hide it); even though this project is in development, it intends to cover the existing vacuum at a network level to anonymize the source of the connections.