Snowden Leak Reveals: Government Spooks Watch Bitcoin Users

The U.S. National Security Agency reportedly has been monitoring Bitcoin users since 2013 on a global scale — with an express imperative to identify supposedly anonymous users and monitor their online cryptocurrency related activities.

The NSA is an intelligence agency responsible for clandestinely monitoring, collecting and processing communications for the U.S. military.

Classified data obtained and distributed by NSA leaker Edward Snowden alleges that the agency has used unmasking tactics to reveal the identities of Bitcoin blockchain users, reported the Intercept, an intelligence news site.

The creation of Bitcoins is publicly recorded and viewable on a blockchain ledger. The identities of Bitcoin miners are anonymous, identified only via alpha-numeric codes.

The NSA uses an advanced computer program called OAKSTAR to monitor Bitcoin user’s online activities, the Intercept reported.

Another program, called MONKEYROCKET, is employed to specifically isolate and track down Bitcoin users who initiate digital currency transactions.

Snowden’s leaked data suggests that the MONKEYROCKET program was used to try to identity anyone who sent or received digital currency online.

The classified data revealed by Snowden is heavily redacted, though publicly available information may corroborate the Intercept’s explosive report.

Along with the NSA, the Department of Homeland Security (DHS) also was alarmingly concerned in 2013 by the rising popularity of cryptocurrencies and their potential to enable criminal activity online.

Brian de Vallance, then the acting assistant secretary for legislative affairs for the DHS, wrote a November 2013 letter to Congress that said, “with the advent of virtual currencies and the ease with which financial transactions can be exploited by criminal organizations, DHS has recognized the need for an aggressive posture toward this evolving trend.”

Privacy conscious

Cryptocurrencies can be created by anyone with a computer and are not regulated by any government or financial regulatory authority. Sending them online is virtually untraceable.

Anonymity means they can easily be used for criminal enterprise, money laundering and the financing of terrorist acts, critics argue. This particular concern may be the impetus behind the NSA’s efforts.

The NSA’s alleged activities, however, pose a threat to online cryptocurrency transaction privacy. For instance, the warrantless collection of Bitcoin user data could be used for prosecution of any crime.

Emin Gun Sirer, associate professor and co-director of the Initiative for Cryptocurrencies and Contracts at Cornell University, believes that Bitcoin users are “privacy conscious” when it comes to financial transactions and “will switch to privacy-oriented coins.”

Referencing Bitcoin’s mandate for privacy, Sirer said, “when the adversary model involves the NSA, the pseudonymity disappears. You should really lower your expectations of privacy on this network.”

dividend stock investing

Make Money While You Sleep with Dividend Stock Investing

Famed investor Warren Buffett once said, "If you don't find a way to make money while you sleep, you will work until you die." Dividend stock investing is a exactly

5 Ways to Slash Your Food Spending and Save Money

The average American spends up to 10 percent of their disposable income on food, according do the USDA. Things are likely different due to the coronavirus, but the typical divide

cooking books

Cooking the Books? How to Know When Companies Boost Earnings Artificially

Experienced investors have heard of now-bankrupt companies such as WorldCom and Enron. Both participated in scandalous accounting schemes. Neither company exists today, but each left a trail of losses that

Potential for Triple-Digit Gains in This Strong Tech ETF

When the select sector SPDRs first launched the telecom sector was considered one of the 10 main economic sectors by Standard & Poor’s. However, this was also the time of

airline stocks

A Bet On Airline Stocks Could Pay Off Big

Patience will be required … but good things come to those that wait! The travel industry has been decimated by the restrictions put in place around the world in an

Are We in a Bubble? How to Hedge Your Portfolio Against Steep Sell-offs

Financial bubbles and bursts are difficult to spot and time. Professor Robert J. Shiller's chart of historical S&P 500 price to earnings ratios is a yardstick for U.S. stock market

Analysis: Markets and the Economy Boom Under Democratic Presidents. But Why?

An interesting report caught my eye this past week regarding the economy and markets under Democratic versus Republican presidents. One would intuitively think that under the latter, economic growth and

Options Calls vs. Puts: What’s the Difference?

Options are nothing more than a contract with a specified premium, strike price and expiration date. Unlike buying and selling stocks or funds of stocks, options provide almost an endless

Most Investors Should Just Forget About Alpha

How would you like to have an "edge" in the stock market? The vast majority of investors would love to find one, of course, and many constantly seek advantages to

Expect Another Big Move from Big Lots

Discount retailer Big Lots (BIG) appears to be benefitting from the current economic environment. The company reported earnings on August 28 and it saw earnings per share jump to $2.75

transfer cryptocurrency

How to Safely and Securely Transfer Cryptocurrency

In today’s fourth article in this five-article series, I’d like to introduce you to the often-confusing universe of cryptocurrency addresses. In the first article, I showed you how to get

warren buffett gold

Warren Buffett Bought Gold? Hold Your Horses There…

Warren Buffett, the famed billionaire investor, has changed his thinking on gold and invested in the yellow commodity. Rather, that’s what the media headlines would have you believe. What is