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Child porn images bring unwanted attention to blockchain technology

Bitcoin SV is not alone in having to deal with illegal materials posted permanently on a digital ledger

The downside of blockchain’s immutable record came into focus this week, when an as-yet-unknown user was discovered to have uploaded child pornography directly onto Bitcoin Satoshi Vision (BSV).

The incident came shortly after BSV increased the maximum file size to 100KB, which the uploader apparently took advantage of. Bitcoin SV proponent Dr. Craig S. Wright noted on Twitter that the issue was not unique to BSV, tweeting “ETH and BTC have illicit material on them. So does Twitter and Facebook. The law accounts for this and allows OSPs [online service providers] that … do not filter and transmit in no knowledge of what is incorporated are not liable.”

Not only has this happened before—in March 2018, The Guardian reported that German researchers found at least one child pornography image and 274 links to similar material—it was predicted three years prior to that by the International Criminal Police Organization (INTERPOL).

In a March 26, 2015 release, INTERPOL noted “[t]he design of the blockchain means there is the possibility of malware being injected and permanently hosted with no methods currently available to wipe this data. This could affect ‘cyber hygiene’ as well as the sharing of child sexual abuse images where the blockchain could become a safe haven for hosting such data. It could also enable crime scenarios … [including] the creation of illegal underground marketplaces dealing in private keys which would allow access to this data.”

The illegal image was uploaded via payment system Money Button to the 11th largest cryptocurrency by market capitalization on Jan. 30, according to a blog post by the company. It was spotted on BitcoinFiles.org’s browser—since taken down—and the company was contacted by authorities, according to BBC News.

BitcoinFiles.org in turn contacted Money Button, which confirmed that its service was used to upload the illegal content. Money Button banned the user responsible and updated its terms of service to make clear that such content was forbidden and would be reported to authorities, it said in the blog post.

Money Button’s post added:

“we are collaborating with other businesses to create protocols and tooling for sharing blacklisted transactions and addresses … If illegal content continues to be an issue, we can build moderation tools into the blockchain. Businesses and users will be able opt-in to blacklists from trusted businesses and authorities.”

Moderation facilities have since been put in place to alert site operators of potentially unlawful content, said Jimmy Nguyen, CEO of lead Bitcoin SV developer nChain, and president of the BSV advocacy group bComm Association. In addition, improvements to source IP address logging have been made, “so that more detailed evidence can be provided to law enforcement authorities to assist in tracking down perpetrators of this or any future crime,” he said.

The good side of the immutable nature of blockchain is that any evidence left by the poster is also there for good.

Proof of this came as recently as Feb. 3, when Israeli financial news site Globes reported that an Israeli company, Whitestream, had succeeded in tracking the source of Bitcoin donations to the terrorist group Hamas only two days after the organization began soliciting them.

The report cited company founders Itsik Levy and Uri Bornstein saying, “In exposing illegal activity, you could say that blockchain itself does most of the work. All activity on the network is registered and documented, so it can be read at a later stage.”

Nguyen seconded that opinion, noting, “the Bitcoin SV blockchain is a not a place for criminal activity, and if you use it for illegal purposes, you will leave a digitally signed evidence trail that cannot be erased. This evidence is fully admissible in a court of law, and you will likely be caught and prosecuted. Think twice and be prepared for legal action before you try adding illegal content to the blockchain. We stand ready to work with global law enforcement authorities to stamp out this and any other illegal misuse of Bitcoin.”

Note: Quotes from Nguyen were added several hours after this story’s initial publication.

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Leo Jakobson, Modern Consensus editor-in-chief, is a New York-based journalist who has traveled the world writing about incentive travel. He has also covered consumer and employee engagement, small business, the East Coast side of the Internet boom and bust, and New York City crime, nightlife, and politics. Disclosure: Jakobson has put some 401k money into Grayscale Bitcoin Trust.