Recently, I went through the article about the biggest cryptocurrency fraud in history executed by a married couple. Ilya Lichtenstein and Heather Morgan, husband, and wife, have been tracked down by the FBI for laundering 119,754 bitcoins from Bitfinex five years ago. After many attempts to rinse the money through chain hopping on numerous anonymity enhanced cryptocurrencies like monero. The FBI was able to apprehend them.
I want to know, what else does the government want to regulate the cryptocurrency blockchain for if the FBI can perform such a rigorous search on all the virtual accounts that have been created online by the couple? And found the private key linked to the wallet that received the funds, and they recovered over $3.5 billion and recorded it as the biggest seizure in the cryptocurrency niche.
“Criminals always leave tracks, and today’s case is a reminder that the FBI has the tools to follow the digital trail, wherever it may lead,” said FBI Deputy Director Paul M. Abbate.
I think the transaction the Government cannot track in the block-chain technology has not be made. FBI claim that they will endeavor to trace any fraudulent activity in the cryptocurreny network through their 21st century investigative technique. (I don't know what they mean by that)
we're able to uncover the source of even the most sophisticated schemes and bring justice to those who try to exploit the security of our financial infrastructure.
-snip-
Read:
https://www.justice.gov/opa/pr/two-arrested-alleged-conspiracy-launder-45-billion-stolen-cryptocurrencyThey were stupid enough to send their ID and verify themselves on a centralized exchange and send coins to the exchange wallet where the exchange was able to link the transactions to the stolen wallet. Yes, bitcoin transactions can be traced to you, but they won't know who YOU are unless they somehow manage to link you with the address (KYC, sending documents or interacting with wallets that has been confirmed to be associated with you). They probably would have never been caught if they knew how to stay under the radar.