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Unconfirmed: Insights and Analysis From the Top Minds in Crypto

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Oct 18, 2019

Jonathan Levin, the cofounder and chief strategy officer of Chainalysis, describes how the blockchain analytics firm helped the IRS identify the administrator of the largest child porn website in the world, which ultimately led to the arrest of the administrator, Jong Woo Son, and 337 site users across 38 countries. The work also led to the rescue of 23 minors from their abusers. He describes how the site used Bitcoin, how they used Bitcoin transactions to identify the users of the site, and how law enforcement worked with exchanges. We also discuss what impact privacy technologies could have on similar investigations going forward, as well as Levin's perspective on the overall utility of Bitcoin despite it being used for illicit activity.

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Episode links: 

Chainalysis: https://www.chainalysis.com/

Jonathan Levin: https://twitter.com/jony_levin 

DOJ press release: https://www.justice.gov/opa/pr/south-korean-national-and-hundreds-others-charged-worldwide-takedown-largest-darknet-child 

Chainalysis blog post: https://blog.chainalysis.com/reports/chainalysis-doj-welcome-to-video-shutdown

Indictment against Jong Woo Son, the administrator of Welcome to Video: https://www.justice.gov/opa/press-release/file/1210441/download 

Bitcoin laundering: https://www.justice.gov/opa/press-release/file/1210461/download

Bitcoin exchanges Welcome to Video recommended + screenshots: https://www.justice.gov/opa/press-release/file/1210451/download

Screenshot of the site seized: https://www.justice.gov/opa/press-release/file/1210446/download 

Joe Weisenthal’s column about how Bitcoin ETFs would make it easier for people to make illicit Bitcoin transactions: https://twitter.com/TheStalwart/status/1184786875262885890

Weekly news recap links: 

Bloomberg article summarizing overall race to create a global coin: https://www.bloomberg.com/news/articles/2019-10-16/fed-drags-feet-as-digital-money-revolution-tests-central-banks

FT on why Libra members dropped out: https://www.ft.com/content/6e29a1f0-ef1e-11e9-ad1e-4367d8281195

Libra Association signs charter: https://libra.org/wp-content/uploads/2019/10/Libra-Association-Charter-Press-Release-.pdf

CNBC article on China’s race to release digital currency: https://www.cnbc.com/2019/10/15/china-races-to-launch-a-cryptocurrency-that-could-rival-facebooks.html?__source=sharebar%7Ctwitter&par=sharebar

Fortune article further describing race between Chinese digital currency and alternatives: https://fortune.com/2019/10/16/if-libra-fails-china-wins-the-ledger/ 

Fed official saying US actively debating digital dollar: https://www.coindesk.com/top-fed-official-says-us-central-bank-actively-debating-digital-dollar

Christopher Giancarlo’s op-ed in WSJ: https://www.wsj.com/articles/we-sent-a-man-to-the-moon-we-can-send-the-dollar-to-cyberspace-11571179923 

IRS tax form: https://www.coindesk.com/the-irs-will-now-ask-if-you-own-crypto-in-the-1040-tax-form