Unchained - Have Crypto Detectives Killed the Cypherpunk Dream? - Ep. 461

Episode Date: February 28, 2023

Andy Greenberg, senior writer for WIRED and author of “Tracers in the Dark,” takes us inside the world of crypto-tracing crimebusters and voices the ambivalence of Bitcoin – a cypherpunk creation – eroding financial privacy. Hear how the longtime crypto scribe got law enforcement and sleuthing firms like Chainalysis to open up about their major wins in taking down darknet kingpins. Show highlights: why Andy thought early on that Bitcoin would enable crypto anarchy how blockchain analytics started being used to tackle crime why the IRS Criminal Investigation unit was more open to discussing its techniques  how Andy learned many new things about already well-known stories when writing about them for the book the methods used to bring down the “biggest dark-web drug lord” in history did AlphaBay’s Alexandre Cazes really kill himself in a Thai prison? how researcher Sarah Meiklejohn developed tools to deanonymize Bitcoin  why she’s now uncomfortable that her techniques were adopted by Chainalysis and sold to law enforcement what Andy feels about the importance of privacy how Monero is harder to trace than Bitcoin but not untraceable what the impact of zero-knowledge technology will be for blockchain analytics firms whether the cypherpunk ethos is dead why the mystery of Satoshi Nakamoto’s identity will never die Thank you to our sponsors! Crypto.com FTSE Halborn NYU Guest Andy Greenberg, senior writer for WIRED and author of “Tracers in the Dark: The Global Hunt for the Crime Lords of Cryptocurrency” Twitter Writings for WIRED Tracers in the Dark: The Global Hunt for the Crime Lords of Cryptocurrency Links: WIRED: The Hunt for the Kingpin Behind AlphaBay, Part 1: The Shadow The Hunt for the Kingpin Behind AlphaBay, Part 2: Pimp_alex_91 The Hunt for the Kingpin Behind AlphaBay, Part 3: Alpha Male  De-Anonymization in Bitcoin with Sarah Meiklejohn | a16z crypto research talks Wikipedia: Welcome to Video case Learn more about your ad choices. Visit megaphone.fm/adchoices

I mean, the cypherpunk vision of cryptocurrency is nearly dead. As I've said, it's kind of like it turned out to be the opposite. It was extremely regulatable, traceable, transparent. It's not at all the crypto-anarchic world of finance that a lot of people hoped it was going to be. Hi, everyone. Welcome to Unchained, your no-hype resource for all things crypto. I'm your host, Laura Shin, author of The Cryptopia. I started covering crypto seven years ago, and as the senior editor at Forbes was the first Main Tree Media Reporter, to cover cryptocurrency full-time. This is the February 28th, 2023 episode

of Unchained. Branchained out from Just Being a podcast, Unchained has launched a new website, complete with more breaking crypto news, education articles for those just getting started, how-to guides and videos. Check it out at UnchainedCripto.com to find answers to all your crypto questions. Web3 projects lost nearly $4 billion of crypto assets, in 2022, but nothing is more expensive than losing trust. Secure your company with Hallborn's best-in-class security advisory solutions. Visit halborn.com for more. Footsie Russell, a leading global index provider,

has applied its trademark expertise, governance, and structure to digital assets, offering institutional quality data to build, manage, and measure investment portfolios. The Exchange-Vetted Flagship Index series measures the investable digital asset market, from large cap to microcap. Get your index data from a market leader. Find out more at footsie rustle.com slash digital asset. Become a disruptor in the emerging fintech space through NYU Stern's new Master of Science in FinTech program.

This one-year part-time program is designed with full-time working professionals in mind. Visit stern.new. www.edu slash MSFT-unchained. Buy, earn, and spend crypto on the crypto.com app. New users can enjoy zero credit card fees on crypto purchases in the first seven days. Download the crypto.com app and get $25 with the code Laura. Link in the description. Today's guest is Andy Greenberg, senior writer for Wired and author of Tracers in the Dark,

the Global Hunt for the Crime Lords of Cryptocurrency. Welcome, Andy. Glad to be here. Nice to talk to you, Laura. Your book is a fascinating look at the world of dark net markets, crypto crime, and the investigators who've taken them down. And even before it came out, I knew it was a must read because some of the excerpts I had read and wired, I just inhaled and could not put them down. So can you talk a little bit about your inspiration for the book and how you decided to cover this world? Yeah. Well, it's cool to talk to you because I also covered cryptocurrency at Forbes. Back before the word, you know, cryptocurrency, even really

existed, I wrote in 2011, I think the first print magazine piece about Bitcoin for Forbes magazine. And I came up with the headline for that piece, cryptocurrency, like thinking that I had come up with this clever pun because I never even heard the phrase before. I mean, Bitcoin was so new. And it was worth a dollar at the time. And to me, like, I came to. cover Bitcoin through covering this kind of, I think a different way from you, perhaps. I was covering from the perspective of the cypherpunks. I had written a book about WikiLeaks and this movement from the 1990s of mostly men, like libertarian radical men who believed that they could use encryption tools to take power away from governments and give it to individuals and carve out places

on the internet where you could essentially defy all government regulation. You could have total secrecy in communications. And, you know, for WikiLeaks, for Julian Assange who was a cypherpunk, he wanted to kind of create like a fully protected anonymous channel for whistleblowers and leakers. So when Bitcoin first appeared, you know, it seemed to me, and it was described to me, in fact, as a kind of cypherpunk holy grail. Like this is not just secret, protected, potentially fully anonymous communications. This is crypto money.

like untraceable anonymous money. And it seemed to me like it was going to unlock a kind of incredible sort of financial crypto-anarchy on the dark web. And that people are going to use this kind of digital cash that you could, you know, you could put unmarked bills in a briefcase and send them across the internet to anyone without revealing your identity. And they were going to use this to, like, do online drug deals and money laundering and all sorts of cybercrime.

And all that, you know, that did happen. And I covered a lot of it before. Forbes. But then I kind of like started to realize even at the time in like 2013, 2014, that the sort of descriptions of Bitcoin's anonymity privacy properties were overblown, maybe imperfect, you know, but it took me really until 2020, I have to admit, to fully realize how completely opposite of correct I had been about this, that Bitcoin is the opposite of untraceable. And in 2020 or so is when I began to see Department of Justice announcements where they were thanking chain alices, a cryptocurrency tracing company again and again as part of these like massive takedowns and busts and indictments.

And that's when I saw that like it wasn't just that Bitcoin was like a little bit traceable. It was truly like the opposite of how it had been described, the opposite of this cypherpunk idea of it. And cryptocurrency, in the large part, like other cryptocurrency, too are completely traceable and had served as this kind of trap I began to see for people seeking financial privacy and especially criminals for fully a decade. And once I saw that, I began to like seek out the people who were smarter than me and had realized that earlier and had used this traceability of cryptocurrency as a kind of incredibly powerful investigative tool to go, you know, on this spree of takedowns and busts and really turn the dark web inside out

and arrest hundreds and hundreds of people. So that story of those detectives who did that is really the story of Tracers in the Dark, this book. And out of curiosity, when you say it was in 2020 that you realized that, do you remember which cases that was? I was just scanning my mind trying to think of like. I think it was actually, let's see, so there was first the seizure of a billion dollars worth of Bitcoin

from this individual X, as he or she was called, who was a hacker who had taken the money, money from the Silk Road, 70,000 Bitcoins from the Silk Road while it was still online, the Silk Road, the Silk Road, grabbed 70,000 Bitcoins. And then I think because that person probably knew that it was dangerous to spend them, had just kind of held onto the amount of fear for seven years as they grew to be worth more than a billion dollars, a billion in 2020, ultimately more by the time that I was writing about this in the book. And It was IRS criminal investigations.

In fact, my kind of protagonist, Tigrin Gambarian, who, despite the fact that the hacker never spent those coins, actually, I guess, moves, or he or she, or wherever, moves some of them through one exchange, but very small amount. That was enough for this IRS criminal investigator, Tigran Gambarian, to track him down and convince individual X, whoever that is, to turn over the money in exchange for not being prosecuted. That was the biggest seizure of not just criminal. cryptocurrency, but money of any kind in Department of Justice history. So that's what made me initially start thinking about chain analysis.

But then I saw, I think also the same year that they had been involved in a terrorist financing case that was described as like the biggest cryptocurrency involved terrorist financing case ever. And then also a North Korean hacker, you know, big heist that had been traced. And the money had, turns out mostly had not been recovered, but had been sanctioned in. This was another, you know, big chain analysis win that the Department of Justice, you know, credited them for. So I think after it was maybe just those three where I began to look more closely. Then I started talking to Jonathan Levin, one of the co-founders of chain analysis. My initial idea was like, maybe I'll just write like a quick profile of this interesting company. And I learned very quickly from Jonathan just how many of the major, major cases that I had even covered over the past.

decade, chain analysis had played a role in, you know, from the, from tracking the very first case that they did almost as a kind of proof of concept was tracking down the stolen half billion dollars of Mount Gawks money, you know, the first like major theft mystery in the history of cryptocurrency. They really kind of quietly solved that case. And then they were involved in the takedown of Alfa Bay, which was a story that I, the Alphabet, you know, being a dark web market that grew to be 10 times the size of the Silk Road. That was a story that I had covered when it broke, but I had no idea of the role the cryptocurrency tracing had played in this epic investigation.

And then finally, like the other, maybe the other, like, biggest case that I tell in the book is Welcome to Video, this child sexual abuse materials, dark web market that chain analysis helped not only take down, but they helped to trace the payments for child exploitation materials of hundreds and hundreds of men around the world. world who were uploading and downloading and, you know, physically abusing children and helped to really find and arrest those pedophiles and to rescue 23 kids. So, you know, once I saw that there were these actually almost like a three-act structure, it seemed like, of these gigantic cases that were still unfolding when I came upon this. I saw that there

was a book to write about this notion of cryptocurrency tracing and about the kind of like incredible 180 that not only I, but I think the whole cryptocurrency community has had in our ideas about Bitcoin's privacy. Maybe you knew that ahead of time, but I didn't. I really was surprised that Bitcoin turned out to be so not private, like truly transparent. Yeah, I mean, I think before then I remember I had had Catherine Hahn on my show and she definitely talked about that and just like how much she loved using crypto for cases. So I had some awareness that this was something that the government like felt was a boon to them. So in that regard,

like maybe I had that inkling just from talking to her. And one thing I want to mention for the listeners is actually a number of these cases that Andy just mentioned we've done previous episodes about, so I will put those in the show notes. But one thing that struck me about your book was It was kind of amazing to me how much you got these government investigators to open up about their techniques. And I was curious just how hard that was or what negotiations you had to do or whether they were like, no, we want to kind of like, you know, be proud and just loud about what it is that we've managed to accomplish. Yeah, I mean, it was a kind of constant tension in the reporting. Like they wanted, you know, to tell these stories. I wanted to tell the stories, obviously.

they wanted credit for a lot of the incredible work that they had done these agents and prosecutors and chain analysis. But they also, I think, you know, there was a certain, like, invisible line they didn't want to cross of revealing sources and methods and in specific cryptocurrency tracing techniques. And I was kind of constantly battling to, like, push them to, like, say a little more or to, like, figure out. Sometimes I was kind of triangulating among them. Like, you know, they didn't really, like, confer in a very organized way about how much they were going to tell me. sometimes I could combine different things that, you know, different sources told me to figure things out. But also, I think maybe like the most important initial thing that unlocked so much of the story was that I didn't try to talk to the FBI or the DEA or, you know, one of these like law enforcement agencies that everybody's heard of. It was a major player in this story was IRS criminal investigations, which is this strange law enforcement agency within IRS.

And they don't get any credit for from anybody ever. Like they are truly like, so they're true. this kind of underdog unrespected. I mean, I think that's, I tried to give them due respect, but I think that they don't get a lot of the credit that they deserve for these major cases.

And so they, I think, were more eager than other agencies to tell these stories, and that really works in my favor, because then once you have IRS CI as part of the story, you know, DEA and FBI wanted to tell their part of it,

too, in some of these cases. And it kind of, everything kind of unlocks. But they're, were serious moments of, I don't know, where I had to balance, like, do I even want to reveal this secret technique? There was, in the case of Alphabet, for instance, basically like a secret technique that chain analysis and IRS criminal investigations came up with together to find the IP address of the Alfa Bay server, of a dark web cryptocurrency wallet server in general. And they

didn't want to tell me how they did that. I mean, there are no IP addresses in the blockchain, so it was really not obvious how they had done it. And they also told me, you know, to please not try to figure it out because this is something they were continuing to use to take down really bad stuff on the dark web, you know, as they described it anyway, including child exploitation and things. So I felt this real dilemma of, I mean, I guess to be clear, like, without even really even trying that hard, I did figure out a really good guess of how it worked, of how this technique for finding IP addresses of cryptocurrency wallets on the dark web worked. I then had to kind of wrestle with whether to reveal my educated guess in the book,

and I went back and forth on it for like a year. Do I keep this technique secret and allow it to be used to take down bad actors? on the dark web and wherever, or do I, and then I'm sort of open to criticism from privacy advocates very legitimately who were saying, you helped to enable financial surveillance. You knew something you could have revealed about the ways that cryptocurrency users can be traced who are trying to be anonymous. And you didn't tell your readers, you know, that's not good journalism. But I also didn't want to enable the bad folks on the dark web to get away with these things. And I was really just very lucky that in the final stages of my reporting in late 2021,

there was this chain analysis presentation that leaked onto the dark web. I think you're very familiar with it because you actually cited it to solve a mystery of your own. And if I remember correctly, about the doubt hacker. And that presentation, which showed up on this dark website called Dark Leaks, had this Italian-language chain Alance's presentation that they had given to Italian police, which had then somehow leaked onto the dark web. And it described, among other things, the secret technique for finding IP addresses of dark web sites,

which was exactly, it was exactly the technique that they had used. And so once it had been kind of like publicly burned, you know, I felt like it was safe for me to include it in the book. Yeah, yeah, of course, once something's public, then it's like, then it's almost weird if you don't include it.

Yeah. So, yeah, then obviously you have a duty to, do so. I just love that story because I agree that when you're writing about this and you're writing about crime or, you know, in our case, crypto crimes, there's a moment where you are a little bit like, okay, so, you know, I'm getting help from these investigators and yet they're asking me not to reveal this or whatever. And then you kind of have to figure out like what's the best thing. And yeah, I had the same issue with my book. And for one of the things this, this part about how chain elsa said demix the wasabi transactions.

There was a moment where, and it might have been like for a few weeks where they were like, we don't want you to reveal that we did this. We're going to have you work it out on your own. Like, we'll give you the tools or something. And I was like, nobody's going to believe that I demixed the wasabi. I was a little bit like what. And then eventually, I know, eventually they took credit, which was great for me. But yeah, there was a moment when I was like, okay,

I'm going to have to reconstruct this. Like, this is going to be maybe weird. But anyway, so out of curiosity, that was such a great story. So I'm sure there are other stories in your book where you uncovered new things or that were sort of memorable for you. And I wanted to ask what they were because what struck me also about the book is that there's actually, the main stories that are covered are ones that like everybody sort of feels like they already know. And so, you know, what else for you was something that surprised you or that was especially memorable? Well, that's see. I mean, if we're going to stick with the Alfa Bay story, which is kind of the centerpiece of the book. You know, that's one that I had covered as a reporter. There was, of course, like a big Department of Justice announcements.

Jeff Sessions, the attorney general gave a press conference about the takedown of Alfa Bay in 2017. And also revealed in that press conference that in this international sting operation called Operation Bayonet, Dutch police had taken over the second biggest dark web market at the time. which was called Hansa, so that when Alpha Bay was shut down, all of Alpha Bay's refugees flooded into Hansa, which was being run undercover by Dutch police and this incredible trap. So, you know, from the beginning, like, I knew that that was going to be a crazy story, but, like, it's a, it's very different to know those, those, like, bare facts, and then to hear the story of how it all unfolded and how, for one thing,

like, nobody knew even how Alpha Bay was actually. taken down. And there was, I guess, this like this story that was known that the founder of Alpha Bay, the kingpin of this dark web drug market, who went by the name Alpha O2, had for a brief time leaked his email address and a welcome email in the very first days that Alpha Bay was online, long before anybody knew, you cared about it, really. And that was when that email address was recorded and given as a tip to the DEA in 2016. Sorry, I'm not sure what all of this was public previously. This is like the story, the actual story.

An anonymous source gave this to the DEA office in Fresno in late 2016. That was in fact like the first time the law enforcement learned the name Alexander Kaz, this French Canadian man who by that time was based in Bangkok and was incredibly wealthy, driving a Lamborghini, owned a villa in Pouquet. Sorry, I'm veering into like, I can't remember anymore what of this was public previous to my reporting, but nobody, I think, knew the story, I certainly didn't, of how cryptocurrency tracing was actually used to pin down his guilt and prove that he was alpha-O-2.

I mean, the people who got that initial email leak tip sort of doubted it. They even kind of wondered if it was too good to be true, if maybe this cause guy was getting set up by, it was being framed by the real Alpha O2. And it was only when these two FBI agents, or analysts, rather, who asked me to call them Ali and Aaron in the DC office of the part of the FBI, they had this just totally independently, had this notion of like, let's try to use cryptocurrency tracing to figure out who Alpha O2 is,

to unmask a dark web kingpin for the first time ever. Nobody had ever done that with cryptocurrency tracing. And they came up with this very clever trick, which was to look at so-called exit scams. Like when the dark web markets, essentially the creator of the market just steals everybody's money and runs off with all of their cryptocurrency

that they had an escrow for their transactions. Allie and Aaron realized that every time an exit scam happens, everybody on the dark web and these markets is freaked out and they pull their money out of the markets. And they warn each other too. Don't store any Bitcoins in a dark web market that you're not about to spend right away because that's really dangerous. It can be stolen in an exit scam. And the only person in those moments who doesn't have to worry, who doesn't pull their money out of a market is going to be the creator of the market himself because he is the one who doesn't ever have to worry about

an exit scam. So they had this notion to really look in chain analysis is software, which by then chain analysis had created this cluster of like 2.5 million addresses that they had identified as Alpha Bay's buyers and sellers and admins and try to find the biggest sums of money held in addresses that had not moved even in the midst of exit scams that had sat there kind of unafraid, you know, and they found some of these clusters with a cluster within the cluster that they suspected might belong to the two alpha-O-2, this, this, this, drug lord, and then traced some of those two cryptocurrency exchanges where they were later cashed out. And they actually sent a subpoena to one of these exchanges just before the tip came

in to the Fresno office about Alexander Kaza's name and then heard that name through the grapevine. It'd already sent their subpoena to this exchange. And then only days later got the result of that subpoena, and lo and behold, it was Alexander Kauza's cryptocurrency account on this exchange, which really was like the confirmation of, that he was alpha-02 and kind of like nailed down this theory that that had previously just hung from a few thin threads. So that kind of like technique, and I try to tell all these stories, you know, from the perspective of the investigators, like make it, you know, bring people into the detective story. And that certainly was like, I couldn't believe when they described that to me. Like,

wow, there really was a new, pretty brilliant idea that actually unmasked the biggest dark web drug lord in history through cryptocurrency tracing. Yeah, one other thing I loved about that story was, and we don't have to go into details, people should read the book because this just gets very juicy. But like, I was completely enthralled when I read about it in the wired piece. But he used this forum and the government figured it out. And they were like watching him in real time, which while they were investigating him. And so that to me was just sort of mind blowing. And in the forum, he was just being his normal self because he thought he had divorced that from his alpha character. And so that was, to me, that was just crazy. Normal self is like putting it

generously. He was like this. I mean, you're being very polite about it. But he He was the sex fiends who had an enormous number of extramarital affairs. He was married to a Thai woman, but was clearly a sex addict who would pick up women in his Lamborghini, sleep with them on an almost nightly basis. He seemed to try to have these hookups. And then would almost live blog it, or at least blog it sort of the next day, on this pickup artist forum called Roushvi. And when the investigators figured out that this person on Roushvi, who went by Romeo, for reasons we don't need to discuss, that person was also Alpha O2, that actually was a huge break in the case because it allowed them to sort of assemble his pattern of life to figure out, he actually brags in this pickup artist form about the kind of full disk encryption that he uses on his laptop.

They knew that they needed to grab this laptop in an open and unencrypted state. because of his posts then. And they also helped him to establish his daily schedule, figure out the best time to essentially try to raid his house in this elaborate undercover agent sting operation that I describe in detail. And also, you know, you could actually see, as you said, like when he was online, because his little profile, like this little figure next to his account would light up green

when he was online on this pickup artist for him. So that's when they saw that on the forum, like when the actual DEA agent was like monitoring this 24-7, they could see when he was online and when his computer would be open and vulnerable to them seizing it, essentially. Yeah. The other thing I have to say is I know people often make jokes about like the government being inept and stuff. But reading your book gives like a very different impression because for a lot of these cases, so many things had to go right for them to. to capture these people or, you know, take down the site or whatever. And time and again, they do it, which is like pretty amazing, especially because for some of them, these cases involve, like, not only different agencies, but like international cooperation, like, with multiple countries. I mean, it's, it's truly fascinating. And there's a lot of good

acting that has to take place to catch them. And yeah, anyway, I was truly fascinating. I mean, I think you're like finishing this story about Alphabet, there's a good example of this. But I think, you know, it doesn't, I guess that it's true, all these things worked out. You know, they had a kind of super weapon here with cryptocurrency tracing that I think none of their targets really understood, like, the degree to which it was possible to unveil all of these, you know, supposedly secret transactions. And that was like an enormous advantage that law enforcement had. But then, you know, like with the takedown of cause specifically, they found his server using that secret IP address identification technique that I just described. But then when they put, when they sent people to Lithuania where the server was kept in a data center, their, their goal was in this elaborate, you know, coordinated takedown to catch him logged into that server, like monitor it, connect to the server, monitor it in real time. and then basically crash a car into his front gate,

trick him into coming out of his house and arrest him, get his laptop open and logged into Alpha Bay while they also could see that connection on the server. They actually crashed the server immediately, and they thought that they'd screwed the whole thing up. They were like, oh, now he's going to see that Alpha Bay is down. All he has to do is close the lid of his laptop, and the whole thing falls apart

because he has then completely encrypted all the evidence they need to really catch him red-handed. And so they had to kind of scramble to put everything into motion at that moment. And they actually, you know, took them months to get access to the server. When it rebooted, it was still encrypted. But they did, so I won't describe, like, all of the action. They'll leave that for the people to read the book, but they did get his laptop in an open state. And I hope this is not a spoiler.

I think people maybe know this who've read about Alphabet. Cause died in a tight jail cell. And that was nobody's intention as far as the people I spoke to. I mean, they found that to be like a tragic anti-climax, an enormous disappointment, to say the least, that like the target of this investigation that they had, you know, been tracking and surveilling and working to capture for nine months died before they could prosecute him. And that is an open-ended mystery, too. I mean, I did my best to figure out if he was murdered as his defense attorney and mother,

tell me or if he committed suicide as prosecutors and agents and long you know the Thai law enforcement agents tell me and i could not come to a you know conclusion about that so i think in a sense after this incredible victory of taking that alphabay and by the way taking over hansa and running it in secret as this elaborate trap the whole investigation still was in some ways unfulfilling for these prosecutors and agents who didn't get their guy i mean he his death was you know a a really tragic outcome. Yeah, that's interesting that you don't have a conclusion about that, because from the way I read it, it seemed obvious that he had committed suicide.

Maybe I'll have to go back and give it a closer read, but... That's interesting. I mean, there are signs that he may have. Like, I got as far as getting the jail cell video, you know, of his cell, the moments in the minutes before his death. And this coroner's report, and I visited that jail cell where he died. died even. I was in that cell. And I saw that there were cameras. And that's why I knew to ask for that video. And I still don't feel like I know with any kind of journalistic, in any sort of like definitive

conclusion that I would share what happens. I have, you know, maybe like on different days, I have different feelings about what happened. But, but ultimately in that video of his jail cell, there's a 30-minute gap at the moment when he died. You cannot, in the tie, you know, the ties told me that gap is just comes from the fact that nothing happens. Like, you cannot see the back of the cell where he either was killed or hung himself in this sort of bathroom area. And they said that, like, all you see for those 30 minutes is nothing.

Nobody comes into the cell. Nothing moves in the frame. So we just deleted that. his defense attorney says, well, why would they delete that? That is what proves that nobody killed him if nobody killed him. That's even more suspicious that they would have deleted those minutes. So, you know, I feel like when I go, when I talk to the Thai guards, I even spoke to the guards who were on duty at the time,

and they seemed extremely casual speaking to me about it. They did not, they were not sweating or whatever. But then I talked to his defense attorney, and he's rightfully extremely suspicious. And I do feel like I have to kind of, I've had to walk away from it as a kind of open a cold case, you know, something I can't really solve. Wait, so the TIE's actually deleted that. Oh, oh, okay. There's half an hour of missing footage from his jail cell at that moment. Okay, okay.

Huh. All right. Well, I guess, yeah, unfortunately. now, then they've, like, erase the evidence, which is annoying. But, all right. They say that they erased, like, they erased this 30 minutes of, you know, still, essentially nothing happening on camera to save space on the hard drive, which I wouldn't, you know, I don't want to, like, attribute to malice what may have truly just been

incompetence. Like, the Thai government probably isn't used to reporters asking to see these videos. So, yeah, I don't know. Okay. This is not a cryptocurrency story. It's a true crime story that I have truly, that is going to kind of like bother me probably for the rest of my career. Yeah. Yeah. Well, there's probably a bunch of those that everybody has. All right. In a moment, we're going to talk more about the book and ask more open-ended questions about crypto reporting. But first, a quick word from the sponsors who make this show possible. Become a disruptor in the emerging fintech space through NYU Stern's new Master of Science in FinTech program. This is a one-year part-time program divided into one online and six on-site modules that take place in New York and in rotating global locations.

The new program is designed for experienced working professionals who want to strengthen their fintech skills or transition to fintech leadership positions. The next application deadline for the inaugural MSFT class of 2024, beginning May 23, is March 15th. To learn more about the program, visit Stern and nyu.edu slash MSFT-unchained. 3.8 billion dollars of value was stolen from crypto projects last year due to compromised private keys, exit scams, flash loan exploits, and other preventable causes. Hallborn offers preventative security solutions for every stage of your software development lifecycle.

From smart contracts, layer one, and DevOps audits, to advanced penetration tests, risk assessments and incident response. With over 150 industry partners, including Anamoka Brands, Salana Foundation, and Ava Labs, Halborn's best-in-class security advisory solutions ensure the safety of company assets and user trust. Visit halborn.com for more. Futsi Russell, a leading global index provider, recently announced the launch of its Market Cap Digital Asset Index series. The newly launched Footsie Global Digital Asset Index series, built in association with the experts at digital asset research, measures the investable digital asset market from large cap to microcap, leveraging a transparent asset and exchange vetting process. Footsie Russell has applied its trademark expertise, governance, and structure to digital assets, offering institutional quality data to build, manage, and measure investment portfolios. Get your index data from a market leader.

Find out more at footsie russell.com slash digital asset. Join over 50 million people using crypto.com, one of the easiest places to buy, earn, and spend over 250 cryptocurrencies. New users enjoy zero credit card fees on crypto purchases in their first seven days. With crypto.com earn, get industry leading interest rates of up to 14.5% on over 30 coins, including Bitcoin. Earned up to 8.5% on stablecoins. With the Crypto.com visa card, you can spend your crypto anywhere. Enjoy up to 5% cash back instantly, plus 100% rebates for your Netflix and Spotify subscriptions, and zero annual fees. Download the crypto.com app and get $25 with the code Laura.

Link in the description. Back to my conversation with Andy. So earlier you alluded to how you had thought of Bitcoin as being something that was was untraceable. And in your book, you actually talk about maybe the first person who kind of pointed out that that's very much not the case. And it's the story of Sarah, it's Michael John or Michael John? I think it's Mickle John, yeah. Mickle John, okay. And so I was curious, if you could just describe what it was that she did and why that was so groundbreaking at that time. Yeah. So Sarah McEljohn was a graduate researcher at the University of California, San Diego. And

And she was a very brilliant cryptographer who had, I think, worked on, like, you know, crypto systems prior to cryptocurrency. And then when she got interested in Bitcoin, it was really with this idea of, like, wow, so people think that this is anonymous, but there's this whole blockchain of transactions that are, yes, they're like between Bitcoin addresses without any obvious identifying information. But this is not, like, truly private in the same. sense that cryptographers think about privacy. You know, Sarah had actually worked on an earlier kind of digital currency system called

Digicash, David Chalm's system, which I believe is like truly untraceable. It has, it is fully anonymous. It has, I think, kind of other practical difficulties in using it. But when she compared that to what you saw with Bitcoin, she was like, what? There's this whole blockchain here. Like, I should be able to figure out all kinds of things about how people are using this, supposedly private money. Her initial intention was, I think, almost anthropological.

She just wanted to study, she wanted to see what she could figure out about what people were doing with Bitcoin and had the idea of just writing a paper about that. And at first she was just even trying to count the number of Bitcoin users. But that led her to coming up with these clustering techniques where she began to prove that sometimes hundreds or thousands or even eventually millions of Bitcoin addresses sometimes belong to a single person or organization or dark web drug market in some cases. That was the first kind of big, I don't know, whole in this notion of Bitcoin's anonymity. Like you could start to link together so many of these addresses into clusters that were really

like someone's money, someone's identity was tied to all of these addresses. And then she started to find ways of not only clustering, but sort of like following. the money in unexpected ways. Maybe the most interesting example of this was change making. With like many cryptocurrency wallets, you can't send a fraction of the coins from an address. You basically send, you sort of like crack over the piggy bank,

send all of the coins from an address, and then receive whichever ones you didn't intend to spend back as change at a new address. And, you know, if you look at that with no sort of prior knowledge, it's difficult sometimes to tell the recipient, address from the change address. But Sarah Mikkeljohn had this kind of like now obvious thought that, well, if the change address was newly created in that transaction, then I can identify it.

And then you can actually see this one sum of money go from address to address, but still belong to the same person. And she called this a peel chain because it's like you can see like a wad of bills almost move from address to address. And, you know, like a bill is peeled off and like given to someone. But then the wad moves to a new ad. address and another bill is peeled off. But it's still throughout that whole process belongs to the same person.

That's somebody's change that just keeps moving from address to address. And then eventually sometimes that hits an exchange and where it's cashed out or, you know, if you go back in time, you can see where it was bought with Fiat. And she realized very quickly that if you were a law enforcement agency, you could send a subpoena to one of those exchanges and then, you know, figure out who owns that WAD or in some cases who is behind that whole cluster of addresses. And then she also, her other big trick was to basically do undercover kind of transactions herself to interact with a bunch of services and people on the blockchain and record all

the addresses she was interacting with, which she could identify. And then once she saw like that, oh, when I move money into the Silk Road and then out again, that's the address that I was interacting with. Well, that's part of this whole cluster, that whole cluster, be the Silk Road. And then I can see Andy, like, sending money to the Silk Road. He must be buying drugs. Like, that's, it's all, like, it almost seems, you know, kind of intuitive now. But with this kind of collection of ideas that I don't think were intuitive at the time to give her full credit, she really, like, created a whole grab bag of tools to, like, to de-anonomize Bitcoin.

And I think changed the way that the, you know, academic world immediately thought about Bitcoin. But I still think, just to like kind of put it in perspective, I read that paper in 2013 and I covered it. And I even asked Sarah to trace some of my transactions that I'd done with the Silk Road when I was at Forbes. And she did. She showed me which transactions I had made to buy like these sort of small amounts of marijuana as a test for Forbes. I wrote an article about this in 2013. And yet I still thought that if you were clever enough, you could stay a step ahead of the tracers.

You could, like, if you put your money through enough addresses or used a mixing service or something, you would be able to defy this blockchain analysis. And I think now looking back, like, it was only really once the really brilliant people at companies like chain analysis got involved at systematizing and automating and improving these techniques. And they had the money to recruit the smartest people to come up with new ways of tracing and new ways to defeat mixing services and all of that. But now I do just think it's safer to say, no, it's impossible, essentially,

to use almost any form of cryptocurrency with privacy, with any anonymity. Yeah, one thing that struck me not only with Sarah's story, but then when she analysis got started was both times. So, you know, when she kind of revealed that she could do that, I think it was shortly there after she went to some conference. And somebody actually kind of made public remarks that sort of were pointed at her or felt like they were at least kind of scolding. Like, you know, you shouldn't be using the blockchain to snoop on people. And then the same thing happened with Shane Ellis is when it started.

And I was wondering if you could just talk a little bit about this kind of tension because, and it's sort of what we even talk to about the government issue, where privacy is obviously an important right. And then yet we're both journalists. So we believe that the public also has a right to know certain facts and information. And so I was curious if you could just talk about where you see chain analysis, you know, walking that line. Like, you know, is what they're doing intrusive or is it something legitimate or yeah? Yeah. Well, you know, as a journalist even, I feel like I came at this whole subject of the cypherpunk world of the dark web and all of that with this kind of deep. felt understanding the privacy is super important. And the first example that I've recovered of it truly was WikiLeaks where that's about granting anonymity to sources, which we all understand

is super important. And I wouldn't want those sources to be traced. And so I don't know, my kind of approach to this initially was like that I found it very interesting and legitimate that cryptocurrency was going to offer a new kind of financial privacy. And once I realized that that that was not the case. I was deeply uncomfortable about the fact that I was basically writing these stories about these, you know, kind of like heroic figures in law enforcement, tracing cryptocurrency to take down bad guys. And all along, I felt this deep ambivalence like financial privacy is important.

And it does not make me feel great that Bitcoin was developed to be an antidote to traditional financial surveillance. Like the fact that a government can just grab your every credit card transaction so easily. And instead of an antidote, Bitcoin turned out to be even worse of a trap in some sense. I did not feel like that was an uncomplicated, good thing. So I was lucky in a sense that Sarah Mikkeljohn, I think, felt the same way. And by telling her story, I could kind of capture this ambivalence, like she also was really uncomfortable with the fact that the techniques she developed were then adopted by

chain analysis, built into a tool sold to law enforcement. She in some ways saw her research on cryptocurrency tracing as a public service announcement. Like, if you think this is private, you know, you should think twice. This is not as private as you think. And she, you know, I think considers herself a privacy advocate. She's a very privacy-focused person. And and so by telling her story and kind of like making her the conscience of this book, I was trying to capture that other side to all of this. That, like, yes, bad people can be caught through cryptocurrency tracing or whatever, people doing bad things, I should say.

But then so can dissidents and journalists and activists who might think that they're making anonymous private transactions. I mean, people definitely around the world have, and I think people have hoped, too, that cryptocurrency would offer a way for people in repressive regimes, for instance, to raise money. But also, like, you know, people may, if they're not aware, like, try to use cryptocurrency to pay for an abortion in the United States or something. And then be surprised to find the note. That actually is extremely traceable. And before they know it, like, they are being charged with a crime. So I, no, I, as a journalist, like, I try to see, like, both sides of this extremely complicated issue. And I spend most of this book, to be honest, telling these true crime, detective stories, but I just really didn't want to leave it at that. I wanted to try to capture the complexity of it. That's, I think, more than like coming down on either side, I feel like it's our job to just show how nuanced and complicated these things are. And, you know, I don't, I don't think that what chain analysis, I don't think chain analysis is an immoral company.

They wouldn't tell me about all of their clients, I should point out. When it came to like the Middle East, for instance, it got a little difficult. to figure out who they sell these tools to. But I think more inherently, like, there will be other chain analysis sees, you know, whatever, who are a Chinese company that will use the same techniques and be capable of the same tracing or a Russian chain alysis or whatever, a Saudi Arabian chain analysis.

And then if it's not chain analysis, like whatever, the techniques are there. They're inherent in the protocol in a way, not in the in like the company doing the tracing or the law enforcement agencies. So I think it's more important to think about the fact that this tracing is possible and it does raise incredible moral complexities and ambiguities. You know, one thing also, though, that I kept wondering throughout the book is that there were large parts of the story where, you know, this is just kind of covering that time when I think a lot of people felt that crypto currencies and Bitcoin were anonymous. But I get the feeling that that perception has evolved, that people have sort of wizened up a little bit about the perils of using crypto or the criminals have. And I was wondering what your take was on that, like whether or not you thought people shifting to using more privacy techniques was going to make it harder for. investigators to catch criminals or whether you maybe disagree with me that some of these dark net markets are turning to privacy tools. How have you seen that evolve? No, I don't disagree at all. I mean, it's very clear. I mean, to just kind of skip ahead to something that happens near the end of

the book, Alphabet came back online in late 2021, now run by its former second in command. And Alphabet now only accepts Minero as, you know, for drug transactions or crime transactions, basically. I think that's a really interesting example. Manero is, there's no doubt far, far harder to trace than Bitcoin has ever been. It like kind of tangles up people's transactions and hides the amounts of them. And, and so, you know, it may seem that like this golden age of cryptocurrency tracing is coming to an end that people are wising up. But I think it's maybe more accurate. just to see it as like another phase, another step in this cat and mouse game. And in that same leaked chain analysis presentation that we talked about,

they claim that they can trace Minero in the majority of cases. You know, they say that it's like in, I think like something like 60% of cases, they can get a usable lead in another 15 or 20%. I forget they can find the sender but not the recipients. I mean, it's, and they do, they sort of confess that it's probabilistic. and not, you know, determine it. It's not like a definitive. But I think that that is often enough.

It's easier than people think to get a subpoena or even a search warrant to get that smoking gun evidence. So I do think that people, you know, like Minero users like get really mad at me for talking about this. But I think that even like today, people are using something like Minero, thinking that it is perfectly untraceable in the way that they maybe used to think about Bitcoin,

and it is not. You can see that chain analysis claims it can do this. In the case of the Bitfinex bust, the arrest of these two alleged New York money launders in, I guess, early 2022, they had actually moved some of those billions of dollars worth of cryptocurrency into Monero. And yet you can see in the IRS court documents that the investigators continue to follow that money until it was exchanged back

into another form of cryptocurrency and cashed out. And it does seem very possible. I imagine chain analysis had to have been involved in that case. It's the biggest seizure of cryptocurrency, again, of money of any kind ever. It broke the record. And it does seem extremely possible. I'll just say that investigators did trace Minero in that case too. I don't know how they did it, but that is their business, is like knowing how to trace cryptocurrencies sometimes in non-public ways.

So do you then think that the future of a company like chain analysis is not really at risk because privacy technologies are coming to crypto kind of all over the industry? People keep talking about how this is really going to be the year for ZK roll-ups and other kinds zero knowledge proof type technologies. I think it's a super, like that exact technology is like a super interesting question because Zcash, you know, you probably knew more about like the use of zero knowledge proofs and services and decentralized like whatever finance. I've looked at Zcash pretty closely and I wrote, I think that like the first piece were wired

about Zcash back in whatever 2016. Zcash does strike me as like truly untraceable. You know, I, of course, I'm like the one who made this mistake about Bitcoin in 2011, but so nobody should listen to me about these things. But zero knowledge proofs are really fascinating. They do seem to offer a kind of true untraceability with like no foothold for an investigator, no clue that can be, no loose thread that can be pulled on.

So I guess then the question is, will these zero knowledge systems like Zcash be adopted enough to completely shut down the tracers and make chain analysis, obsolete, you know. It strikes me that like regulators are already, it seems, trying to step in where technology is defeating tracing, like the regulation is trying to tag in, basically, and sanction or indict, like people who are trying to offer anonymity. Like, we're seeing this with one mixer after another that is enabling, for instance, North Korean money laundering,

of their big heists, that those mixing services, even if they have some legitimate users, are being sanctioned. So if Zcash were to start to really catch on, both for people seeking financial privacy but also criminal uses, you know, would governments essentially just start to sanction or even like criminally charge every exchange that lets you buy and sell Zcash? I mean, it seems like where tracing fails, like where there are these kind of pockets of like true invisibility, policy might step in and try to squash that, you know. And so if there are only kind of like a limited number of privacy outlets, maybe that is

something where, you know, regulators step in and chain analysis can kind of, or in its, and it's silk. I should say there are like a whole industry in these companies now, like TRM and elliptic. And they can do the rest of the tracing. So in everywhere, but these few sort of pockets of darkness. So I say darkness in, like in terms of like invisibility, anonymity. So I don't know. It's, it's, it remains to be seen. I think it's going to be like a super interesting new kind of tension and conflict in the crypto world. Yeah, but one question. And you maybe sort of addressed it earlier when we discussed chain analysis, but I was just curious, like, do you feel that those types of analytic firms kind of take cryptocurrency away from

the cypherpunk ethos? Or do you feel like, you feel like, you know, this is an important tool to have, or what's your take on it? I think that the, I mean, the cyphorpunk vision of cryptocurrency is nearly dead. As I've said, it's kind of like it turned out to be the opposite. It was extremely regulatable, traceable, transparent, just not at all the crypto-inarchic world of finance that a lot of people hoped it was going to be. And, you know, is it really chain analysis or elliptic or TRI? Rem who did that, who killed it, you know, who killed that dream.

I think they would argue it was Satoshi who like built the system in a way such that it could be traced, you know. Michael Granigar, the founder of the very first founder of chain analysis, you know, he says that like, yes, this is how Bitcoin was built. I didn't do this. This is the nature of the system. It is the most transparent system of finance ever created. And he kind of describes it almost as if Satoshi intended it that way.

But I don't think that that's actually that part I don't agree with because Satoshi wrote in that first email to a cryptography mailing list that participants can be anonymous. So, you know, and it turns out that specifically like only Satoshi has remained anonymous. He's like he or she or they are the only person who has pulled that off in the whole, you know, universe of crypto whales, I would think. So yeah, I don't know. I think that regardless, though, this idea that cryptocurrency could offer that world of untraceability or kind of crypto anarchy as some people wanted to see it is just a pipe dream. Yeah. So one other thing that I wanted to ask about was, so you were one of the reporters that did try to look into who Satoshi was a couple of times.

There was an article where you kind of investigated how Finney perhaps being Satoshi. You were one of multiple reporters who looked into Craig Wright's claims. Obviously, that ended up, you know, being maybe one of the watershed moments I would imagine for journalists in crypto. So I don't know, you know, what your takeaways are about the parallels of trying to figure out who Satoshi is or. Yeah, maybe not the right kind of watershed in that case. Yeah. And, you know, out of curiosity, like, why is it that you think that that's one of the only mysteries that has remained unsolved? So two-part question, one for media and one for Satoshi.

I don't know. I never even really set out to try to figure out who Satoshi was. I kind of stumbled upon these leads in both cases, one of which I think was like, you know, Hal Fannie lead was super intriguing. It still kind of blows my mind that he lives a few blocks away from Dorian, Satoshi Nakamoto, the person who Newsweek, I think, I think it's fair to say, like incorrectly. identified as Satoshi. But that was a crazy coincidence, ultimately, that led me down this path of thinking that perhaps

Hal Finney was the real creator of Bitcoin. I mean, what are the odds that like this allegedly first ever user of Bitcoin and this, and the proven second ever user of Bitcoin, Hal Finney, were in the same neighborhood, you know? I mean, so that was a, and by the end of that investigation, to be clear, I wrote the story as like, yes, I once thought that how Fannie was Satoshi, he's not. But he's a super fascinating, important figure in the history

of crypto. That's how I, that's the conclusion that I came to in that piece. The Craig Wright story is like a much darker rabbit hole that I went down where, I don't know, I don't want to get sued by Craig Wright, but I do not believe that he is the greater of Bitcoin anymore. And

the way that I came to believe that was that I essentially like was offered these documents that I now believe were forgeries but I'm I'm not sure even who created. I'm not sure that it was that they were intended to fool me. I think they may have been I don't know. I don't want to like speculate too much. It was a bizarre trap that I fell into with the Greg Wright case. But now I don't know.

I have first of all had had enough traumatic. experience is trying to chase this mystery down. But I also, I never really wanted to solve it until I thought that I was going to be the one to do it. And then it's, it's sort of the temptation is too great. But like, I never really wanted to, to ruin this amazing mystery. Like, the fact that Satoshi is still this mysterious figure, that is just one of the juiciest mysteries in the history of technology. And I love the fact that it hasn't been solved. And it, it, I mean, it's just refreshing in a way that there can be that kind of unknown left in the world of the internet and technology. Now I'm fine with it.

And I kind of, you know, really, I just think it's like a fascinating and incredible phenomenon that Satoshi, whoever he or she or they are, has sat on essentially tens of billions of dollars worth of cryptocurrency and not spent it and not reveal themselves. and not left any clues, even for all of these incredibly adept tracers that are the subjects of my book. Yeah, yeah. Well, I guess probably the reason is because Satoshi never tried to cash out. And so that's really why. Exactly. Yeah. You know, the reason that Satoshi is the only person for whom this is true that participants can be

anonymous is because Satoshi just that incredible inhuman restraint to sit on, like, one of the biggest fortunes in the world. I mean, I think it's sometimes, like, I don't know, has Satoshi ever been the richest person in the world? I think almost. Or whatever. Maybe it's a group. But to not even cash out a single of the coins in that trove is, you know, yeah, I think Satoshi deserves to win and remain anonymous. I hope that that remains the case at this point. Yeah, I have to say, I mean, you know, I reread your Halfini article. And a part of me is like, yeah, well, Okay, I don't want to go too much down that wrap a hole because I think this leads us back to Craig Wright territory. But the notion that whoever it is or whoever they are maybe died is like one reason why the coins might not have moved. Absolutely. That's like an interesting theory. I just, and I think a lot of people still believe that it was Hal Fannie.

But, you know, and I'm sorry, I haven't reviewed the evidence of the whole Fowl-Halfini case like before talking. But I do, you know, this was 2014. It's a long time ago now. But I, you know, for one thing, I was in the room with Halifini interviewing him in this paralyzed state. He was dying of ALS. And he's like answering my questions only with like his eyebrow movements. But he and his family just so like convincingly denied to me that he was Satoshi. And, you know, like for one thing, like, why would he lie?

but also I was persuaded that these were like credible denials and then his son showed me his Gmail account where he was communicating with Satoshi which would be hard to fake especially

I don't know like do you do that retroactively how do you do that retroactively and and you know was how thin he like was Satoshi, rather, like smart enough to, was Hal Fannie slash Satoshi if we're going to go down this, this, the path of this theory, like smart enough to create this fake record of emails between

the two of them from years earlier. I don't know. It just starts to strain credulity. And like it, I just came to believe instead that, that, no, he is just like the second ever user of Bitcoin. And, and in fact, like, how many did eventually. With eye movements alone, I think a list in an email to me. It's very difficult for him to write emails.

And I felt bad even making him deny this in detail. But he listed reasons why he was not Satoshi. And they included details of the programming languages that they used and other things. So I'm convinced that Houthini was not Satoshi. It doesn't mean he wasn't an incredibly remarkable person. And I don't know why Satoshi, how Satoshi has managed to keep this. secret and practice that restraint disappears so completely. It's possible that whoever the real Satoshi is is also dead for all we know. Yeah, that's why I referred to the Craig Wright thing,

because I think his partner, Dave Clyman or whatever died. So one other thing that I just want to ask about was, you know, when I read coverage of this space in Wired, it feels like kind of different coverage from, you know, the way, for instance, a crypto publication covers it or even actually some of the general tech media. And I wondered if you could talk about either both your philosophy and the publications philosophy around how to cover what's going on in this industry. It's really interesting. It's an interesting question. I think that, you know, the media has maybe like gone through its own like cycles of like crypto hype and then crypto winters, you know, that are sometimes almost unrelated to the price of these things. Like for a while,

it wasn't like not cool to talk about Bitcoin, but it was cool to talk about blockchains for some reason. And then I don't, I never understood that. Like, and, and then, I don't know, it was interesting to talk about like, defy and Ethereum and things, but,

but it was not interesting to just like talk about more traditional cryptocurrency. I mean, these are just, I'm describing like the trends in the media. And I think that to some degree, the cryptocurrency, world has sort of been wrapped up in the tech clash as well. You know, like this idea that like, we at Wired, I think, have gone through our own cycles of like Wired was once, you know, if you read like very early Wired issues as I have done, like the optimism and the idealism about

how technology would change the world are just like, you know, so complete. And then I would say with our last editor-in-chief, Nick Thompson, we sort of started to embrace more of a more nuanced and ambivalent view about the effects of technology. And I think that came with a lot of skepticism around the effects of social media and what it did in 2016, about a lot of cyber war kinds of things that I cover and the dystopian potential futures that that's the insecurity of the Internet and the ways that it's tied up in our lives is included in all of that. And then with our new editor in Sheetheed, Gideon-Litchfield, it's been very interesting because at one point he actually kind of told the staff. And I think this is to his credit. Like it was a smart, interesting thing that like,

we are not going to be like party poopers in a simple way about Web3 and crypto and all of this stuff. We are going to understand it and we're going to tell complicated stories about it. And I think that maybe, you know, it's it was possible that like we wired were starting to become too skeptical of crypto. I think there have been so many different promises about cryptocurrency over the years that didn't pan out, that eventually becomes almost like a reflexive thing to the doubts every cryptocurrency promise. And I think it was, you know, in addition to the kind of like big features that I've written about cryptocurrency crime, specifically, that's my interest in the subversive and illegal and dangerous uses of this stuff. you know um we we also galad adelman did a a great cover story about web three for wired uh last year that was is one of my like favorite pieces i've read about that world and his adventures in it and

we i think we tried to take like a more complete and nuanced view of all of this stuff okay well before we started recording you did also say that you felt that the ftx story which was blowing up right when your book came out was also a story about tracing movement on the blockchain. So I was curious for your thoughts on that. Yeah, well, right. I mean, I think most people are looking at this FDX thing. Maybe not you.

You know so much about all of this and the details of the case. But they're seeing it almost as like a Lehman Brothers or like a Theronos kind of meltdown. Like this was a hyped up sort of shady company making false financial promises, maybe doing irresponsible things with people's money. But then in the midst of all of this, like in the middle of that may all be true. But in the middle of all of that, there was also just an actual theft, it seems, like unauthorized, just grabbing of half a billion dollars or so, some hundreds of millions of dollars worth of FDX's funds. We don't know who took them. We are still, like, actually the tracers that are the subject of my book are watching that money move.

They're watching it on blockchains in real time. That's like the bizarre thing about these big cryptocurrency thefts is that you can basically watch the getaway car, like move through the open plan of the city and watch every turn it takes. And if the thief or whoever they are in this case tries to cash that money out, I think it's going to be very difficult for them to do it in a way where they won't be identified. And then we will, I think, at some point, sooner or later, I think, hopefully know the answer to whether this was an actual external hacker or if it was. Wait, what are you talking about? Because isn't the, I mean, so initially when you said theft, I thought you meant of the exchange, you know, of its customer's money, but or buying the exchange of its customer's money. But when you, now I'm getting a little bit confused. Well, we don't know yet whether this money was pulled out by FTX insiders or actual external hackers who are taking advantage of this meltdown to just steal this money. Are you talking about the hack that happened after the bankruptcy was filed?

Oh, got it. Okay. Yeah, exactly. So that's sum of money. I mean, it's almost like history repeating itself with Mount Cox in 2014, where Mount Cox was bankrupted. and half a billion dollars went missing in 2014. A lot of people suspected that that was the CEO of Mount Cox had taken that money or lost it with some kind of financially responsibility. And in fact, it was Russian hackers that had stolen it. And he was, Marka Pellas, the CEO of Mount Cox, was actually vindicated by cryptocurrency tracing,

through cryptocurrency tracing. And I'm not saying that's going to happen here, but it's just like interesting to see history repeating itself. We're still in the phase of this meltdown where we're trying to figure out if it was external or internal theft. So I think a lot of people suspect it was internal that this is just another part of the actual potential crimes committed by Sandbank-Fried and FDX's staff, but we don't know that yet. So I think cryptocurrency tracing may tell us the answer sooner or later.

Yeah, I probably agree with you there. All right, well, this has been a truly fascinating discussion. I have just loved diving into your book and your philosophy and thoughts around cryptocurrency and analytics. Where can people learn more about you and your work? Oh, I guess. Well, my website is andygreenberg.net. You can find my books and articles there. You can just look me up on Wired and I'm, you know, still writing for Wired all the time.

Perfect. Well, it's been a pleasure having you on Unchained. It was a really fun conversation. Thank you, Laura. Thanks so much for joining us today to learn more about Andy and his book, Tracers in the Dark, check out the show notes for this episode. Unchained is produced by me, Laura Shin, without from Anthony Youne, Mark Murdoch, Matt Pilchard, Zach Seward, Juan Oranavich, Sam Shry Rum, Ginny Hogan, Ben Munster, Jeff Benson, Pamajumdar, Shashon, and CLK transcription.

Thanks for listening.