# I thought bitcoins were untraceable? Colonial ransom partially recovered **URL:** \ **Category:** Factual Questions\ **Created:** [June 7, 2021, 9:01pm UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790 "2021-06-07T21:01:14Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![DrDeth](https://avatars.discourse-cdn.com/v4/letter/d/b487fb/32.png) [@DrDeth](https://boards.straightdope.com/u/DrDeth)\ **Post date:** [June 8, 2021, 1:17am UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/21 "2021-06-08T01:17:58Z")
They demanded $ **5** M, 2.3 was recovered… so far. ---
**Author:** ![Duckster](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/duckster/32/1244_2.png) [@Duckster](https://boards.straightdope.com/u/Duckster)\ **Post date:** [June 8, 2021, 1:20am UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/22 "2021-06-08T01:20:41Z")
> [@](#): > > The FBI was able to seize control of DarkSide’s proceeds by gaining access to a central account holding about 63.7 bitcoins, worth around $2.3 million, Deputy Director Paul Abbate said. [A court document](https://twitter.com/Bing_Chris/status/1401986750306832390) said that the seizure took place in Northern California, putting it within reach of U.S. law, and that the FBI was able to access the “private key,” or password, for one of the gang’s bitcoin wallets. It was unclear how the key was compromised. > **[Feds recover millions from pipeline ransom hackers, hint at U.S. internet tactic](https://www.nbcnews.com/tech/security/u-s-recovers-millions-pipeline-ransom-because-hackers-mistake-n1269889)** > > A Russian ransomware gang hacked into Colonial Pipeline in May as part of a monthslong crime spree, leading the company to shut down operations. ---
**Author:** ![Tired\_and\_Cranky](https://avatars.discourse-cdn.com/v4/letter/t/a87d85/32.png) [@Tired\_and\_Cranky](https://boards.straightdope.com/u/Tired_and_Cranky)\ **Post date:** [June 8, 2021, 1:39am UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/23 "2021-06-08T01:39:26Z")
Perhaps they could but I guarantee, unless the check is done automatically in all versions of the software used to transact in Bitcoin, some innocent person somewhere is going to fail to do the check properly, sell a bunch of priceless Beanie Babies on Ebay for Bitcoin, and discover they have accidentally committed a felony and lost all their money. We will also have people who transact in whatever narrow window of time it is between the time the illicit Bitcoin makes it onto the banned list. Even if those people did everything right, they still might discover their coins are effectively illegal all of a sudden. ---
**Author:** ![Andy\_L](https://avatars.discourse-cdn.com/v4/letter/a/c67d28/32.png) [@Andy\_L](https://boards.straightdope.com/u/Andy_L)\ **Post date:** [June 8, 2021, 1:41am UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/24 "2021-06-08T01:41:11Z")
Thanks ---
**Author:** ![dtilque](https://avatars.discourse-cdn.com/v4/letter/d/d6d6ee/32.png) [@dtilque](https://boards.straightdope.com/u/dtilque)\ **Post date:** [June 8, 2021, 3:29am UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/25 "2021-06-08T03:29:46Z")
> [@DrDeth](#): > > They demanded $ **5** M, 2.3 was recovered… so far. From what I understand, they got the majority of the bitcoin back. It’s just that the value of bitcoin has dropped significantly since the ransom was paid, so they only got about half the dollar amount back. ---
**Author:** ![Chickenwrangler](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/chickenwrangler/32/91_2.png) [@Chickenwrangler](https://boards.straightdope.com/u/Chickenwrangler)\ **Post date:** [June 8, 2021, 4:02am UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/26 "2021-06-08T04:02:44Z")
Question from an absolute novice who knows nothing about Bitcoin. All these Bitcoin numbers floating about, can they actually converted into real money? How would one do that, Can you just go into a bank with your Bitcoin statement and get cash? ---
**Author:** ![Tired\_and\_Cranky](https://avatars.discourse-cdn.com/v4/letter/t/a87d85/32.png) [@Tired\_and\_Cranky](https://boards.straightdope.com/u/Tired_and_Cranky)\ **Post date:** [June 8, 2021, 4:11am UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/27 "2021-06-08T04:11:37Z")
There are various exchanges (like Coinbase and [others](https://en.wikipedia.org/wiki/List_of_bitcoin_companies)) that specialize in exchanging Bitcoins for dollars and vice-versa. Transactions happen at market prices though, so if wanted to dump a lot of Bitcoin all at once, the price would probably drop dramatically. ---
**Author:** ![Half\_Man\_Half\_Wit](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/half_man_half_wit/32/21766_2.png) [@Half\_Man\_Half\_Wit](https://boards.straightdope.com/u/Half_Man_Half_Wit)\ **Post date:** [June 8, 2021, 5:29am UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/28 "2021-06-08T05:29:21Z")
> [@Pleonast](#): > > Anyone doing a transaction can, as a first step of the transaction, check that the involved bitcoins are not on the illegal list. OK, I seem to be missing something here. I thought what’s recorded in the blockchain are just transactions—‘Alice gives Bob 5 BTC’—, but not the individual Bitcoins. Indeed, I thought there really wasn’t such a thing as an individual Bitcoin, with the fact that each individual token has a unique identifier being the main thing that distinguishes NFTs. So I thought that if Alice sends Bob 5 BTC, and Bob later sends Charlie, Dave and Eve 5 BTC each, then there’s no real fact of the matter that, say, the 5 BTC sent to Dave are ‘the same’ as those sent to Alice, or that 2 of those sent to Charlie and 3 of those sent to Eve are, or what have you. Just like there’s no fact of the matter that if somebody pays 10 € into my account, and I wire 10 € to you, those are ‘the same’ 10 € or not. It’s just the balance that gets logged, not the individual coins. Is that mistaken? ---
**Author:** ![nightshadea](https://avatars.discourse-cdn.com/v4/letter/n/7ba0ec/32.png) [@nightshadea](https://boards.straightdope.com/u/nightshadea)\ **Post date:** [June 8, 2021, 9:11am UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/29 "2021-06-08T09:11:09Z")
supposedly back in czarist Russia, the law was no one could accept a tip or anything like that but one was entitled to steal all they could carry/get away with … Sounds like the theory is alive and well … ---
**Author:** ![nightshadea](https://avatars.discourse-cdn.com/v4/letter/n/7ba0ec/32.png) [@nightshadea](https://boards.straightdope.com/u/nightshadea)\ **Post date:** [June 8, 2021, 10:28am UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/30 "2021-06-08T10:28:19Z")
erm accept a tip from a foreigner ---
**Author:** ![kanicbird](https://avatars.discourse-cdn.com/v4/letter/k/5f8ce5/32.png) [@kanicbird](https://boards.straightdope.com/u/kanicbird)\ **Post date:** [June 8, 2021, 10:29am UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/31 "2021-06-08T10:29:53Z")
> [@Pleonast](#): > > Presumably the company told the FBI which transactions were used to pay the criminals. The FBI can then follow those bitcoins _forever_ . Well yes but the same way that through the conservation of information, the information contained in a book that is burnt can be fully recovered, the block chain is able to be decrypted, and deciphered. It just may take quantum computers to practically do that, and when quantum computers get good enough to do this, Bitcoin will be using quantum encryption. So it’s not practical for anyone to trace a bitcoin transaction in such a manner. You have the record forever of every transaction, but it’s not understandable. It appears what happened here is that the FBI was able to obtain the key from a sub group of these hackers in the US. Perhaps some of the crook may have set their password to ‘password’, or their pets name or had it on a slip of paper next in the case of their cell phone. The FBI it seems suspected this sub group, it hints that a warrant was issued, and monitored their computer(s) through a back door. > **[Feds recover millions from pipeline ransom hackers, hint at U.S. internet tactic](https://www.nbcnews.com/tech/security/u-s-recovers-millions-pipeline-ransom-because-hackers-mistake-n1269889)** > > A Russian ransomware gang hacked into Colonial Pipeline in May as part of a monthslong crime spree, leading the company to shut down operations. ---
**Author:** ![Chronos](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/chronos/32/134_2.png) [@Chronos](https://boards.straightdope.com/u/Chronos)\ **Post date:** [June 8, 2021, 10:57am UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/32 "2021-06-08T10:57:16Z")
> [@Half\_Man\_Half\_Wit](#): > > OK, I seem to be missing something here. I thought what’s recorded in the blockchain are just transactions—‘Alice gives Bob 5 BTC’—, but not the individual Bitcoins. To the extent that bitcoins can be said to exist at all, what they are is the record of the transactions. There’s effectively a big book, readable by anyone, that contains a record of all of the transactions. That book will contain records like “On January 1, account number 123 mined a bitcoin. On January 2, account number 123 transferred a bitcoin to account 456. On January 3, account 456 transferred 0.4 bitcoin to account 789, and then on January 4, account 456 transferred 0.6 bitcoin to account 012”. If, at this point, account 456 also tried to transfer anything to account 345, it couldn’t, because anyone with access to that ledger (which is to say, anyone at all) could see how much was transferred into and out of 456, and do the subtraction, and thus see that 456 no longer has any coin to transfer. As to why no government has ever made it illegal to trade in stolen bitcoins, I suspect that it’s because they value the information about criminal transactions more. Every time a criminal transacts with another criminal, that gives you an account to add to your Usual Suspects list, and every time they transact with a non-criminal, that gives you an opportunity to connect an account with a name. Take the example of the attackers behind this incident. They now have all of these red-flagged accounts full of money. They want to do something with that money. If what they’re doing with it is buying something legal like a mansion or a yacht, then the government can subpoena the yacht company’s records, and find out who they delivered it to, and now they have the thieves. ---
**Author:** ![Chickenwrangler](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/chickenwrangler/32/91_2.png) [@Chickenwrangler](https://boards.straightdope.com/u/Chickenwrangler)\ **Post date:** [June 8, 2021, 10:58am UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/33 "2021-06-08T10:58:16Z")
Sorry to sound silly, but does digital currency actually exist in any physical form ? If everyone was to cash in their Bitcoins at the same time, where would the actual real money come from? I’ve heard the phrase “mining” in relation to Bitcoins. Saw a program about a whole shed full of computers running 24/7 doing nothing but “mining”. Also seems any computer can be “Hijacked” to run a Bitcoin “mining” program. How does all this work? If Bitcoins can be pulled out of thin air where is the real value? ---
**Author:** ![GreenWyvern](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/greenwyvern/32/2834_2.png) [@GreenWyvern](https://boards.straightdope.com/u/GreenWyvern)\ **Post date:** [June 8, 2021, 11:33am UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/34 "2021-06-08T11:33:45Z")
There’s a looong discussion about bitcoin’s traceability in [this thread](https://boards.straightdope.com/t/bitcoins-are-they-a-net-negative-to-human-society/940889/) starting about post #50. @HMS_Irruncible will tell you that in a perfect, abstract world bitcoins are untraceable, and if you insist on using them in the real world, that your problem. 😀 TL;DR Bitcoins are often traceable at the point you buy or sell them for dollars at an exchange. Sophisticated software also exists to analyze the blockchain and trace complex movements of bitcoins through multiple intermediate wallets. There have been a number of cases where bitcoins were successfully tracked down and criminals arrested. ---
**Author:** ![DPRK](https://avatars.discourse-cdn.com/v4/letter/d/4491bb/32.png) [@DPRK](https://boards.straightdope.com/u/DPRK)\ **Post date:** [June 8, 2021, 11:45am UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/35 "2021-06-08T11:45:29Z")
If I really had to guess, they went after any U.S.-located members they could find. They would not fail to pursue that line. Once they have you, your movements and financial records, all your electronic equipment, all the information you sent and received from that equipment, accounts and servers you used, everybody you talked to or messaged, etc., they begin to have real compromosing information on your gang, plus you have every incentive to betray your confederates to avoid a million years in US prison. > [@Chickenwrangler](#): > > Sorry to sound silly, but does digital currency actually exist in any physical form ? You could print any digital currency out onto paper, if you really wanted. A QR code would suffice. The point is to have them on your computer, smartphone, smartcard, and so forth, though. You can’t e-mail a piece of paper but you can transmit a number. As for bitcoins (or dollars) having “value” despite being pulled out of thin air, apparently there is at present at least a dysfunctional bitcoin economy, as this thread demonstrates. “Mining” (something unique to bitcoins) is merely a way of enticing new users and distributing the initial coins, and is not directly germane to tracing bitcoins (the “mined” bitcoins are traceable to an initial block in which they were generated). ---
**Author:** ![HMS\_Irruncible](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/hms_irruncible/32/7394_2.png) [@HMS\_Irruncible](https://boards.straightdope.com/u/HMS_Irruncible)\ **Post date:** [June 8, 2021, 12:15pm UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/36 "2021-06-08T12:15:59Z")
> [@GreenWyvern](#): > > @HMS_Irruncible will tell you that in a perfect, abstract world bitcoins are untraceable, and if you insist on using them in the real world, that your problem. 😀 Ah, I see you’ve chosen to bring your unsupported mischaracterizations into this thread as well. That’s unfortunate as this is GQ and not GD, and does a disservice to people looking for actual information. > [@GreenWyvern](#): > > TL;DR Bitcoins are often traceable at the point you buy or sell them for dollars at an exchange. tl;dr there’s no such thing as a Bitcoin, thus you cannot “trace a Bitcoin”, thus you’re continuing to spread your uninformed opinion as fact. ---
**Author:** ![bump](https://avatars.discourse-cdn.com/v4/letter/b/7c8e57/32.png) [@bump](https://boards.straightdope.com/u/bump)\ **Post date:** [June 8, 2021, 12:22pm UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/37 "2021-06-08T12:22:57Z")
Christ, what a bunch of shitheads the Russian goverment is. ---
**Author:** ![GreenWyvern](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/greenwyvern/32/2834_2.png) [@GreenWyvern](https://boards.straightdope.com/u/GreenWyvern)\ **Post date:** [June 8, 2021, 12:51pm UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/38 "2021-06-08T12:51:36Z")
Since this is GQ, I look forward to you presenting facts to back up your opinions. ---
**Author:** ![Whack-a-Mole](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/whack-a-mole/32/141_2.png) [@Whack-a-Mole](https://boards.straightdope.com/u/Whack-a-Mole)\ **Post date:** [June 8, 2021, 1:17pm UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/39 "2021-06-08T13:17:49Z")
Yes and no. A bitcoin transaction can occur pretty much immediately. However, the way the blockchain works it is possible for someone to double-spend (or more) a given bitcoin. For example, I buy something from you and something from someone else at the same time using the same bitcoin. The network has not had time to spread the record of that transaction yet so each person sees the bitcoin in their wallet. After some time the network sees two transactions using one bitcoin and it will reject one of the entries (so someone loses that bitcoin and is not paid). As a result most bitcoin transactions take around an hour to happen so the person getting the bitcoin can be sure it is really in their wallet. ---
**Author:** ![bobsmom101](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bobsmom101/32/2867_2.png) [@bobsmom101](https://boards.straightdope.com/u/bobsmom101)\ **Post date:** [June 8, 2021, 1:29pm UTC](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790/40 "2021-06-08T13:29:14Z")
> [@DPRK](#): > > If I really had to guess, they went after any U.S.-located members they could find. They would not fail to pursue that line. Once they have you, your movements and financial records, all your electronic equipment, all the information you sent and received from that equipment, accounts and servers you used, everybody you talked to or messaged, etc., Forgive my naivete, but if you are the Feds and have suspects, wouldn’t installing a keylogger on their computers get you the wallet passcodes without any high tech maneuvers? [Previous page](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790.md?page=1) [Next page](https://boards.straightdope.com/t/i-thought-bitcoins-were-untraceable-colonial-ransom-partially-recovered/943790.md?page=3)