Hundreds of thousands of Bitcoins have been stolen from users since the beginning of the virtual currency, we can see all these thefts in real time in the blockchain. We know to which addresses the stolen coins are sent and from which they are stolen. We can follow the life of a Bitcoin over the network.
This is where our privacy engine can provide valuable services. The more BTC addresses you can assign to an address containing stolen Bitcoins, the higher the chance that the new owner can be found. Every day about 300,000 new Bitcoin addresses are used in the blockchain, each of which could lead you to 'your' thief.
- A Bitcoin was stolen from address 1abc...
- In the blockchain we see that the bitcoin was sent to address 1def... .
- Our privacy engine observes address 1def... days, weeks, months or years and after all finds out that 15 other addresses with high likelihood belong to the same owner as address 1def... . It does not mean that all 15 coins were stolen, it is only about finding the thief.
- If the thief now exchanges one of the assigned coins at an exchange or if he can otherwise be associated with this coin address (e.g. mention on the Internet), then this can be decisive in criminal prosecution.
- We could also help to trick the thief with dust attacks to increase the chance of getting the coins back. This works by sending a tiny amount to known addresses of the fraudster/thief. If the recipient's Bitcoin wallet (like most wallets) then uses this so-called "dust" in future transactions, then we know additional Bitcoin addresses of the wanted person, which increases the chance to find him many times over. Such an attack can be carried out in several stages.