In this article, we will talk about the possibility if Bitcoin can be traced. With the current state of cryptocurrency in today’s business world, the value of Bitcoin still remains unstable. It may soar really high with a possibility of $20,000 and the cryptocurrency hype that came along with it but can also plunge into the abyss with a $7,500 market value.
Before we continue to tackle the traceability of Bitcoin, let me just give you a brief review of what Bitcoin is. Bitcoin or BTC in the global stock market is the oldest form of cryptocurrency that was invented in 2008 by Satoshi Nakamoto which is a pseudonym. Bitcoin is a form of digital currency that can be used for transactions without involving your personal bank. It is actually based on a technology which is called blockchain.
Now that we somehow re-introduced Bitcoin, let us dive into the main topic of this article:
Can Bitcoin be traced?
The answer is YES! Well, theoretically speaking, Bitcoin itself is not traceable but your Bitcoin transactions can be traced. Since its’ inception, most people involved in trading and moving Bitcoin thought that it is completely untraceable. But they were completely wrong. In this digital world that we live in, it is quite possible to hide your identity, but there are still traces of your digital footprints that are left behind. With that concept, it also makes Bitcoin somehow traceable as it is also part of the digital world.
By its’ original design, Bitcoin is not really connected to a real person’s identity. This system uses the alphanumeric form of strings which can be considered as a public address that can be used for transactions that will be recorded in the so-called blockchain.
Although the personal info of the person doing the transaction is not visible anywhere during the transaction, the IP address that the user had while using the public address can still be tracked down. Even if the person is using private wifi, the IP address that was given to that wifi can still be tracked down when a very rigid investigation is done. Internet Service Providers uses the identification of people who use their internet services. IP addresses that were specifically given to that person can be tracked down by the government agency and other private companies that keep track of these kinds of transactions.
The main reason why Bitcoin transactions are being traced either by government enforcement agencies or by private firms is that, with the former’s main goal is to catch organized crime groups from moving certain currency to fund their principles and the latter is doing it for the main purpose of staying afloat in the business world.
In this high-time of the crypto-currency hype, most traders know that Bitcoin has no serial number but the wallet that you will create is linked to a special type of alphanumeric codes that is somehow tied up to the IP address of your wifi. So, it is safe to say that, somehow Bitcoin can be traced.
With this concern, most traders are looking for improvements in this system. Addresses for Bitcoin wallets that require changes will be implemented soon. GUI or graphical user interface of this system will also be improved in time so as to be more user-friendly to the not-so-computer-savvy traders out there. More researchers are doing everything to improve the state of security of trading and moving Bitcoin. I guess it will not take long for this system to be completely untraceable and fool-proof.