How to find out the owner of a bitcoin wallet by number

Buying goods and services

Some people leave their data in online stores. When buying goods, information about the client remains in the processing center’s database, even if services that hide real addresses are used. If a delivery to the place of residence is ordered, it is not difficult to trace the relationship between a person and crypto coins. Stores are also hacked. Therefore, it is better to open a separate identifier for each purchase.

Online wallets

This is the most affordable option for storing bitcoins. Web wallets that store private keys on their servers, funds and user information posted online are always vulnerable to hacking. To avoid this, many exchanges put most of the cryptocurrency in cold (offline) storage. Therefore, if you want to hold bitcoins in an online service, you need to make sure that the platform provides them with maximum security.

Wallet number when transferring funds

To send bitcoins, you need to know the address of the recipient. No one but its owner can take the funds. Since when “signing” a transaction, an algorithm is launched that verifies the ownership of the private and public keys.

Law enforcement capabilities

With the development of blockchain technology in many countries there are requirements for licensing, registration of activities related to bitcoins, recognition of them as an object of taxation.

In Russia, the law on digital financial assets came into force on January 1, 2021. It regulates cryptocurrency trading. According to the regulatory act, digital coins are equated to property, their sale is subject to personal income tax at the rate of 13%. From 2022, it is planned to increase the rate to 15% for income over 5 million rubles. Failure to pay taxes and conduct illegal transactions with bitcoins is punishable by a fine. The expansion of the legislative framework increases the powers of the executive bodies.

To find out the owner of a bitcoin wallet, law enforcement agencies can obtain the following information. First, they request from the Internet provider the frequency and periodicity of access to the network. Next, a computer-network examination is carried out. It allows to obtain information about the user’s actions in the network without access to his computer. Even if the operations were carried out with the help of desktop or hardware wallets.

The expertise provides the following information:

• Addresses that the person visited on the Internet.
• Information about the use of credit cards in making digital payments.
• The content of emails and messages received or sent using communication services.
• Computer accesses to remote resources, as well as logins, passwords, date and time of connection, data about the provider.

Then the obtained information is supplemented. For this purpose, at the legislative level, law enforcement agencies are allowed to establish companies using documents that conceal their identity.

Since all transactions are registered in the blockchain with the date, time of conclusion and amount, analyzing clusters of transactions between specific addresses allows you to find out whose bitcoin wallet is whose.

In addition, while online exchange services used to be anonymous, in many cases it is now necessary to undergo identity verification in order to make transactions. With this information combined with blockchain data, it is possible to identify the participants in the transaction and find the owner of the bitcoin wallet. For this purpose, operatives often involve experienced IT specialists.

The main mistakes in bitcoin wallet management

Investors lose millions due to lost keys, address blocking or other reasons. Here are the most common mistakes.

• Entering incorrect transaction data means losing coins. It is impossible to recover funds sent to the wrong number.
• Loss of access to coins or the funds themselves (due to hacking) are the most common consequences of improper storage of private keys (initial phrase, not related to storage) or password (custodian).
• Despite having a strong password for a hot wallet, the user must be aware that the provider has access to these funds. Therefore, those who store large sums on online services are at risk of losing them.
• Other mistakes are connecting to public Wi-Fi networks, falling into the trap of crypto-fraudsters, using wallets with many features (built-in exchanges, bets and so on), but with a low level of security.

How to protect yourself

The following tips will help to reduce the risk of losing coins:

• Conduct research on the service where the user is going to open a vault. It is necessary to study reviews, making sure that the platform is safe.
• Before sending a payment, you need to double-check the address of the recipient, the blockchain commission, and the amount of the sending.
• Use well-known and regulated exchanges: even if the wallet is in the app store, it does not mean that it is legitimate.
• Check if the address starts with https: // or if there is a lock sign on the left. This line contains important information about where the service is located, how secure the site is.
• Create a wallet on your own and do not give anyone access to the private keys.
• Know the public and private keys. Passwords that will be needed to access the money are best kept offline.
• Make a backup copy of the ID and store it in a safe place.
• Diversify by asset type the digital vaults and exchanges used.

Anonymity

In the early days of bitcoin and the lack of understanding of blockchain technology, it was believed that all transactions involving cryptocurrency were confidential. Therefore, there was a perception that it was being used by criminals for illegal transactions.

It is now clear that the public bitcoin registry is available for public viewing, and it records the history of all transactions.

Bitcoin addresses are “anonymous” as long as they are not linked to a real person. Transactions are used to link the transaction to the owner:

• Identity verification (know your customer, abbreviated as KYC).
• Anti-money laundering (AML) – a policy of measures aimed at laundering illegally obtained money.
• User IP research.
• Address clustering.

Some vaults can directly link bitcoin owners and their bank accounts and thus allow the bitcoin wallet owner to be recognized by number.

Tips for maintaining anonymity

The bitcoin address created is viewable by anyone online. By it, the balance, payment history and other information is tracked.

To preserve anonymity, it is advisable to:

• Create a separate address for each transaction and use it once.
• Do not post your bitcoin number on social networks or other online communities.
• Block the reading of your IP, which is reflected in each transaction. For this purpose, you can install the Tor service.
• Use various mixer services that accept payments in bitcoins, mix them and send BTC from different people in return.