Bitcoin transactions are not anonymous, and at least some Russian hackers are complete morons. Those are the two key takeaways from the Mueller Report (and some other political stuff, I guess).
Or at least, they’re the takeaways we’re being asked to believe.
Bitcoin, it seems, is the gift that kept on giving investigators on Robert Mueller’s team a whole immutable record of certain transactions… the ones that he concluded pointed to the G.R.U. (Russian foreign intelligence) and their sophisticated state-sponsored hackers, known as Fancy Bear. These transactions were specifically connected to interference in the 2016 U.S. presidential election.
According to CNN, The U.S. Justice Department’s Special Counsel investigator and his team unearthed several BTC transactions used to fund everything from the attempted hack of the Democratic party to fake news sites, all intended to stir political conflicts.
Mueller mentioned in his report a transaction that paid for dcleaks.com, where stolen Democratic Party documents were posted: “Unit 26165 [determined to be a G.R.U. cyber unit] paid for the registration using a pool of bitcoin that it had mined.”
Although many lay people believe Bitcoin transactions are completely anonymous, the transparent nature of the blockchain ledger makes transactions easy to trace, given sufficient resources. While the BTC ledger doesn’t display any obvious personally-identifiable information, tracing an address can easily open the gateway to a user’s entire Bitcoin transaction history.
Perceived Anonymity… Because Hackers Are Dumb
Mueller went on to explain that Russian intelligence agents “conspired to launder the equivalent of more than $95,000 through a web of transactions structured to capitalize on the perceived anonymity of cryptocurrencies such as bitcoin” as they sought to interfere with the American election.
Read that again: according to the Mueller investigation, Russian intelligence agents had no idea that Bitcoin could be traced… because they perceived it to be anonymous!!
It’s kind of fun to imagine this коллектив, making pancakes in the morning, singing cheery tunes in the afternoon, and getting down to some serious and eminently-traceable Bitcoin purchases in the evening. Guccifer 2.0 was probably on Quora, trying to work out how to store a private key, while the rest of the Russian intelligence cyber-penetration team worked on trying to assemble a 6-drawer HASSELVIKA from IKEA.
Mueller concludes that Bitcoin did allow Russia to evade direct relationship with any large banking or financial institutions. Another scene from this unlikely saga:
“Tovarishch, I wish to open a bank account here at Deutsche Bank.”
“Certainly sir, what is the primary purpose of your account?”
“Interfering in the U.S. presidential election?”
“Ah, you’ll need our Dimon-level account, let me connect you with our Dr. Wright.”
Even though giant banks are actually very good at money-laundering, perhaps the G.R.U. opening an account at the same one that extended billions of dollars in questionable loans to Donald Trump would look a little suss.
In an interview with CNN Business, Tom Cotten, a blockchain developer and security researcher who compiled his own brilliant and engaging assessment, noted that the Mueller probe traced BTC transactions to the email addresses used to create accounts on exchanges to purchase bitcoins. Cotten was at pains to note that “It should be stressed that every point of data I’m going to reference is searchable with free, public tools on the web.”
Or in other words… “Hello, I’m Hansel and this is my sister Gretel, we’d like to open an exchange account please.”
The Mueller team also pointed out that Russians used stolen and fake ID’s (FAKE ID’S!!!) for many of their email accounts, but used many of the same email addresses to purchase servers and web domains involving the Democratic party hack and fake news sites. That allowed investigators to quickly put the pieces together.
Fake ID’s? Seriously? Is the G.R.U. primarily composed of 17 year-old boys who can’t buy wine coolers at The Moscow Mule?
Mueller is beginning to sound like a cross between Peter Falk and Leslie Nielsen… and the G.R.U. is beginning to sound like a Scooby Doo villain. “If it wasn’t for this pesky Bitcoin, we would have gotten away with it!”
A Conspiracy Theory In The Making?
Conspiracy theories are exciting, but the popular ones don’t seem to find much resolution in the public arena. We still don’t have aliens at Area 51, or proof that Kennedy was assassinated by the CIA.
In truth, as Cotten points out, there is surely much more to this than we can see. And there’s enough complexity here to suggest that the people behind these acts did not perceive the future risks of their traceable actions.
But I don’t believe, not for one minute, that Russian intelligence is stupid or ignorant. I therefore find it incredibly difficult to credit the notion that the people who hacked the Democrats and spread disinformation through U.S. tech companies used Bitcoin… because they had no understanding that it could be traced.
In fact, what really IS extraordinary, is just how clear Bitcoin made the trail. Straight to the G.R.U. In fact, according to Mueller, straight to Grizodubovoy Street in Moscow.
Which is pretty specific, given that Mueller had to leave other significant conclusions to an Attorney General who was not connected to the investigation.
Additional reporting by Jalen Fargharson