Read this (sorry about the archive link, but the source is paywalled.)
Authorities hadn’t yet mastered how to track people and groups hidden behind blockchain wallet addresses, the series of letters and numbers used to anonymously send and receive cryptocurrency. One elemental feature of the system was the privacy it gave users.
That's a lie.
A very popular lie but a lie nonetheless. I pointed it out at the time and its very important because it formed the entire basis on which this sector of so-called "digital assets" were built, marketed, sold and used and it was maliciously false and known so from inception.
Every single person involved in creating these things knows it too; indeed, without that "feature" all of them are trivially counterfeited and thus worthless.
Dollars have value in part because you can detect a counterfeit by mere inspection. Those who handle money on a routine basis, down to the high school kid with a part-time job in an ice cream shop know instantly if they're passed a fake bill and 99% of the time they're right. When I was young I worked at a car wash and everyone, other than the cop shop across the street that had an open account to wash the cop cars, paid cash. I handled a crazy amount of cash just working there and within a very short time of being hired if you tried to give me a fake $5 you were going to get caught.
In the monetary space this is called self-validation; that is, it is evident to the users on both sides of the transaction that the currency is authentic.
Digital encrypted storage only is authentic if it can be absolutely traced. But because each transaction must be able to be digitally proved since nothing physical changes hands this means the provenance of each such transaction all the way back to the origin of a given unit of said currency is permanently traceable and indelible at a level that is much higher than that required for "strict proof" (beyond a reasonable doubt) in court.
Notice that the makers of these "coins" have never published the means by which such transactions can be trivially traced back to origin at the inception of their "coin"? They know damn well this can be done and have all deliberately not released that at inception because a huge part of their draw is the claim that such transactions are "anonymous", even though many of them do not explicitly so-state.
Well, now we're seeing it. And if you've ever engaged in any sort of unlawful act using one of these and you're within the Statute of Limitations anywhere in the world for such an activity you're exposed. Only time and the Statute of Limitations, if there is one in every jurisdiction involved, will change any of this -- if not that nice pleasant exposure is a Sword of Damocles over your head forever.
Some folks have claimed that certain coins -- Monero, in particular -- had implemented a way around this. Those claims were lies.
They have always been lies because digital currency requires you be able to trace the transaction otherwise you can spend the same thing twice and thus the entire so-called "currency" collapses and, given the speed with which one can do that using computers it will be destroyed almost-instantly by said counterfeiting once that capacity gets out into the public. As soon as that risk appears nobody will ever take it again because there's no way for the person on the receiving end to know if the alleged "currency" you are presenting is good -- or a counterfeit as unlike the $5 bill you can't handle and look at it; none of these are self-verifying and never can be as they all rely on digital infrastructure and electrical power.
