U.S. seizes $2.3 mln in bitcoin paid to Colonial Pipeline hackers

[Jet_ski]

Summary

The Justice Department on Monday recovered some $2.3 million in cryptocurrency ransom paid by Colonial Pipeline Co to hackers. The investigators had seized 63.7 bitcoins. According to the Justice Department, they have "found and recaptured the majority" of the ransom paid by Colonial.

 

A judge in San Francisco approved the seizure of funds from this "cryptocurrency address," which the filing said was located in the Northern District of California.

 

The FBI attributed the hack to a gang called DarkSide which they describe as a Russia-based cybercrime group.

 

Quotes

Quote

An affidavit filed on Monday said the FBI was in possession of a private key to unlock a bitcoin wallet that had received most of the funds. It was unclear how the FBI gained access to the key.

 

My thoughts

Well done the FBI. Disrupting the energy supply is definitely a national security issue and would be a top priority for them. The fact that they've managed to trace the wallet and even get the key is just bonkers. If their methods are repeatable, it will hurt the crypto as some criminal transactions might no longer use Bitcoin!

 

If you remember the ransom was $5 million paid in Bitcoin around the time Bitcoin was $60,000. So the smaller $2.3 million recovered is mainly due to a drop in Bitcoin prices.

 

Sources

https://www.reuters.com/business/energy/us-announce-recovery-millions-colonial-pipeline-ransomware-attack-2021-06-07/

[IkeaGnome]

This is amazing! Glad to see ransomware get prosecuted. It's a shame it took (no pun intended) oil for it to happen. 

I wonder what this does to the "Bitcoin is untraceable" and therefore bad argument....

[DrMacintosh]

I thought the whole point of crypto was that you weren't supposed to be able to do this. Lmao. it's time for it to die imo and for everyone to realize that crypto is never going to become what cash is today. Nations won't allow it. 

[poochyena]

Without looking at OP's article, can you guess what time today this news was announced?

[COTG]

1 hour ago, Jet_ski said:

Summary

The Justice Department on Monday recovered some $2.3 million in cryptocurrency ransom paid by Colonial Pipeline Co to hackers. The investigators had seized 63.7 bitcoins. According to the Justice Department, they have "found and recaptured the majority" of the ransom paid by Colonial.

 

A judge in San Francisco approved the seizure of funds from this "cryptocurrency address," which the filing said was located in the Northern District of California.

 

The FBI attributed the hack to a gang called DarkSide which they describe as a Russia-based cybercrime group.

 

Quotes

 

My thoughts

Well done the FBI. Disrupting the energy supply is definitely a national security issue and would be a top priority for them. The fact that they've managed to trace the wallet and even get the key is just bonkers. If their methods are repeatable, it will hurt the crypto as some criminal transactions might no longer use Bitcoin!

 

If you remember the ransom was $5 million paid in Bitcoin around the time Bitcoin was $60,000. So the smaller $2.3 million recovered is mainly due to a drop in Bitcoin prices.

 

Sources

https://www.reuters.com/business/energy/us-announce-recovery-millions-colonial-pipeline-ransomware-attack-2021-06-07/

Bitcoin is quite literally a public ledger, and not used for criminal transactions apart from a few incompetent criminals. Privacy coins exist for a reason. Since the FBI has the addresses private key, it also reaffirms the incompetence of the hackers as they likely had it stored online/local pc's which is in of itself quite braindead. 

[COTG]

1 hour ago, DrMacintosh said:

I thought the whole point of crypto was that you weren't supposed to be able to do this. Lmao. it's time for it to die imo and for everyone to realize that crypto is never going to become what cash is today. Nations won't allow it. 

you really can't generalize "crypto" like that. First of all, btc is more so a store of value rather than a currency, but also the most boring aspect of crypto in general. Money in the future will 100% be DLT based, since instant finality and complete transparency offer simply too many advantages. Money is already basically digital and ledger based, however just using a significantly more inefficient version than possible. The first iteration will likely be a CBDC, where China looks to be leading at the moment with the US however starting to realize the importance of the issue. 

Furthermore, decentralized finance as it is currently built on defi basically allows for trustless financial interactions where you are still able to keep custody of your own money. The entire traditional financial system is currently being rebuilt there, in a trustless manner with the only real application still missing being undercollaterlized loans. And since basically every single currency in a decade will be a cryptocurrency, be it a CBDC or a decentralized one, permissioned bridges to access defi are easy to implement. 
Can't really type out everything I want here since I would be stuck for hours, but my point is that trying to shoehorn crypto as a now $1.6T industry into the single usecase of alternative money is ludicrous in my eyes 

[ARikozuM]

1 hour ago, DrMacintosh said:

I thought the whole point of crypto was that you weren't supposed to be able to do this. Lmao. it's time for it to die imo and for everyone to realize that crypto is never going to become what cash is today. Nations won't allow it. 

The opposite is true. You have addresses for nearly every transaction that takes place and once you find who owns that address you can find their trail much more easily than with credit/debit cards or cash. 

[Jet_ski]

25 minutes ago, COTG said:

Can't really type out everything I want here since I would be stuck for hours, but my point is that trying to shoehorn crypto as a now $1.6T industry into the single usecase of alternative money is ludicrous in my eyes 

I think @DrMacintosh’s comment encapsulates the general public’s understanding of cryptos. There’s been a lot of misinformation about this and I don’t blame them for it. Plenty of Bitcoin proponents have and still claim it’s privacy and untraceablility as features.

[xAcid9]

Nani? How did they get the private key to access the wallet? Did the hackers use some 3rd party wallet service? 

[BuckGup]

2 hours ago, DrMacintosh said:

I thought the whole point of crypto was that you weren't supposed to be able to do this. Lmao. it's time for it to die imo and for everyone to realize that crypto is never going to become what cash is today. Nations won't allow it. 

Your first sentence tells me you don't understand how crypto works and your third reinforces that. I suggest educating yourself about the subject more. Imagine if I was ranting how the ACH is the devil and credit cards aren't real because I can't hold the money I spend with them. Crypto is here to stay and I'm sorry you're butthurt about that

[BuckGup]

1 hour ago, Jet_ski said:

I think @DrMacintosh’s comment encapsulates the general public’s understanding of cryptos. There’s been a lot of misinformation about this and I don’t blame them for it. Plenty of Bitcoin proponents have and still claim it’s privacy and untraceablility as features.

It's untraceable if you can't tie the wallet to a person. But many use online wallets, or lack general security, under the assumption that it's the same as an offline wallet which is not a smart idea in terms of safety. Also they could of used a wrapper across a private blockchain like monero to make it untraceable.

[xtroria]

12 minutes ago, xAcid9 said:

Nani? How did they get the private key to access the wallet? Did the hackers use some 3rd party wallet service? 

Perhaps through hacking, or in-person interrogation or torture.

 

Either way, I don't care, these criminals don't deserve to be treated as human beings

[Vanderburg]

35 minutes ago, BuckGup said:

It's untraceable if you can't tie the wallet to a person.

"It's untraceable if you can't trace it". I'm impressed.

[BuckGup]

11 hours ago, Vanderburg said:

"It's untraceable if you can't trace it". I'm impressed.

The blockchain doesn’t contain personal identifying info. An online wallet tied to a phone number, email, IP, or device fingerprint does. You can’t design a blockchain to avoid stupidity 

[staticpage]

20 hours ago, DrMacintosh said:

I thought the whole point of crypto was that you weren't supposed to be able to do this. Lmao. it's time for it to die imo and for everyone to realize that crypto is never going to become what cash is today. Nations won't allow it. 

It saved a whole country from damnation (Venezuela if you live under a rock) this week but go on and keep fighting it and not understanding the need for it.

[wanderingfool2]

21 hours ago, DrMacintosh said:

I thought the whole point of crypto was that you weren't supposed to be able to do this. Lmao. it's time for it to die imo and for everyone to realize that crypto is never going to become what cash is today. Nations won't allow it. 

It's in no way confirmed, but there was some speculation that it could have been when the bitcoins were transferred to an exchange (because from there the FBI would have a company to contact and seize the bitcoin from).

 

It doesn't surprise me that it was eventually seized, with such a large amount I would imagine that it would be pretty hard to launder the money.

 

20 hours ago, COTG said:

Bitcoin is quite literally a public ledger, and not used for criminal transactions apart from a few incompetent criminals

It's used by a decent amount of criminal transactions (mainly through ransomware).  The issue is that when you are talking about $250-$10000 per scam, it becomes a lot less likely that the criminal will be caught; just because they can clean the money before getting booted out of all the exchanges.  I know companies that have paid thousands to ransomware and don't report it (because if they report it then it becomes public knowledge)

[Mihle]

7 hours ago, wanderingfool2 said:

It's in no way confirmed, but there was some speculation that it could have been when the bitcoins were transferred to an exchange (because from there the FBI would have a company to contact and seize the bitcoin from).

 

It doesn't surprise me that it was eventually seized, with such a large amount I would imagine that it would be pretty hard to launder the money.

 

It's used by a decent amount of criminal transactions (mainly through ransomware).  The issue is that when you are talking about $250-$10000 per scam, it becomes a lot less likely that the criminal will be caught; just because they can clean the money before getting booted out of all the exchanges.  I know companies that have paid thousands to ransomware and don't report it (because if they report it then it becomes public knowledge)

In the past there was methods used with stolen BTC that they basically sent them via hundreds of addresses in smaller accounts making it harder to follow, and then somehow eventually probably changed to Montero or similar and then back to BTC or to Money.

 

But I think law enforcement and stuff have been better at tracing that kind of stuff too than what they were.