by “Tracers In The Dark” by Andy Greenberg (Doubleday)
The year was 2011. Cryptocurrency was a little-understood novelty, and Senator Chuck Schumer called a press conference to vent outrage over a one-stop online store for illegal drugs whose technology made sellers “virtually untraceable.”
The New York lawmaker’s description of the Silk Road helped sow a persistent myth that tech reporter Andy Greenberg exhaustively debunks in “Tracers in the Dark,” according to which transactions in Bitcoin and other cryptocurrencies cannot be trace.
Greenberg charts the evolution of an entirely new discipline in the surprisingly vibrant real-life police procedural, following law officers and coders who invent and implement cryptocurrency tracking tools to catch a new breed of criminals. They take down Silk Road and other “dark web” marketplaces and merchants, launder cryptocurrencies, and trap the system administrator and users of Welcome to Video, a major South Korea-based distributor of child sexual abuse materials.
The best of the action are two dramas of removal. Alexandre Cazes, a young Quebecois behind the AlphaBay dark web marketplace, lives it large in Thailand, zipping around in a Lamborghini, billing $12,000 at restaurants, and bragging about adulterous sexploits online. The other takedown involves a DEA agent and a Secret Service agent who got rich illegally off the Silk Road while investigating it, each completely on their own.
But Greenberg is more interested in super-geeks blazing this new trail of digital law enforcement as they track cryptocurrency on the so-called blockchain, where every transaction is recorded. The persons making the transactions may not be immediately identifiable and often use so-called “mixers” to try to obscure them. But painstaking digital detective work – and carelessness – foils many cybercriminals.
In the spotlight are Tigran Gambaryan, an Armenian-born accountant turned IRS agent, and blue-eyed Danish programmer Michael Groniger, co-founder of Chainalysis, a pioneer in commercial crypto-tracing, which numbers law enforcement agencies and intelligence agencies among its major clients. Readers also meet crypto-tracking academic pioneer Sarah Meiklejohn, daughter of a meticulous prosecutor.
To his credit, Greenberg deftly teases technical details without slowing down the narrative. A writer for Wired, he’s made it into other titles that trace the beginnings of major technological phenomena. “This Machine Kills Secrets” explores WikiLeaks and other actors in the dissemination of politically motivated secrets. “Sandworm,” named after an infamous Russian military hacker team, chronicles the rise of cyberattacks.
“Tracers” follows its main characters through the takedown of the Silk Road and AlphaBay, the 2014 theft of the Bitcoin exchange Mt. Gox ($530 million at the time), and the disturbing failure of Welcome to Video. The agents who worked on that case can never hide the horrific images they gathered as evidence, linking purchases to clients’ cryptocurrency wallets.
Well told is how the Dutch cyber police surreptitiously take over and run Hansa’s dark web marketplace just as customers of the closed AlphaBay sign up in droves. The author also addresses newer cryptocurrencies, including Monero and ZCash, which claim to be untraceable.
One story that Greenberg is unable to tell well is that of the largest criminal cybercoin exchange to date, BTC-e. It’s certainly not his fault.
Before being taken down in 2017, BTC-e was the No. 1 recycling facility. 1 for the proceeds of extortionist ransomware gangs, which like the exchange mainly operate in post-Soviet countries. Important details of his relationship with the Kremlin remain undisclosed. Its alleged manager, Alexander Vinnik, was arrested in Greece and extradited to the United States. Rare Russian cybercriminal to face Western justice, alleged to have laundered more than $4 billion and awaits trial in California.
For all their success in tracking down Bitcoin and other cybercurrencies, the heroes of Greenberg’s book are often frustrated by the lack of Russian legal cooperation in particular. None of the powerful tools created by the programmers of Chainalysis and its competitors, including Elliptic and TRM Labs, can stop a thief that justice cannot reach.
