CEIC 2015 Student Session Series: Bitcoin 101
Students from Champlain College and the Leahy Center for Digital Investigation (LCDI) attended multiple training sessions while at the Computer Enterprise Investigation Conference (CEIC) 2015. Student Kevin Dobrolet presents some highlights from the Bitcoin 101 session.
Presenter Andy Reid helped pull Bitcoin out of its low public profile and into the spotlight. Following an explosion in value in 2013, this “cryptocurrency” continues to be used to move money, conceal assets, and purchase contraband items through the Dark Web.
Mr. Reid introduced the basic concept behind Bitcoin, explaining that it is a decentralized virtual currency that originated from an individual (or organization) named Satoshi Nakamoto. An individual user can generate Bitcoins by “mining,” or spending computer processing power to solve an increasingly complex algorithm. Bitcoin miners and users form a network of nodes that help regulate and verify the process, including transactions between users on a global ledger. All transactions and rewarded Bitcoins go into a personal virtual “wallet” that can be stored on hard drives, mobile phones, or even given QR codes and imprinted on physical objects.
Bitcoin and other currencies like it are not inherently bad. The problem lies within where and for what the currencies are spent. The Silk Road (and several of its iterations), a notorious website found in the darker side of the Internet and accessed through the Tor browser, at one point accepted Bitcoin for use in transactions involving weapons, drugs, and a plethora of illegal goods. Because no central bank or government controls Bitcoin, this currency can be spent with zero discretion, even if each transaction is recorded on the ledger that sits in every Bitcoin user’s computer.
As Mr. Reid noted, investigations into cryptocurrencies are only just beginning. Artifacts related to Bitcoin are being searched for on user devices. Searching under AppData/Roaming/Bitcoin, Mr. Reid revealed the wallet and ledger information for his Bitcoin account. With careful examination and cross-analysis based upon transaction records found in the global ledger and the data discovered on a user’s device, it now becomes possible to determine where those Bitcoins went or came from. With that information in hand, the act of tracking down illegal sales and illicit activities becomes slightly less cumbersome.
You can view Andy Reid’s previous presentations on Bitcoin from CEIC 2014 here: Bitcoin, Litecoin and Alt Currencies. These are some of the highlights, but Reid went into great depth on Bitcoins throughout the session and we would highly recommend it.