The US Department of Justice announced that it managed to close one of the largest web site with child pornography, followed by the arrest of 337 persons in 38 countries. Tracking bitcoin transactions helped to identify them.
337 people were arrested during an international operation within the investigation of the South Korean Welcome To Video website, which hosted over 250,000 videos of child pornography. The site was located on the darknet. Its popularity can be judged by visitors statistics. Many videos were downloaded more than a million times. Law enforcement authorities seized more than 8 terabytes of child pornography. This is equivalent to about 4,000 hours of footage or 24,000 clips of 10 minutes each one. On average, users paid 0.03 BTC ($236) for a video downloaded.
As part of the same operation, about 23 children in the USA, Great Britain and Spain who were subjected to violence were rescued. The investigation began after Dr. Matthew Falder, geophysicist and graduate of the University of Cambridge, was arrested. He confessed to 137 crimes related to the sexual exploitation of children. Falder is currently serving a 25-year prison term in the UK.
The site allowed not only to buy child pornography, but also to sell uploaded content. All transactions were paid in bitcoins. New users received a unique bitcoin address during registration, to which they had to pay. The site had 1.3 million bitcoin addresses. WTV had earned approximately $353,000 in bitcoins within the three years before it was closed in 2018.
Chainalysis, which creates tools for analyzing blockchains, helped track down the criminals. As some users of the site sent payments for porno videos from their accounts on crypto exchanges, Chainalysis was able to track these transactions using its Chanalysis Reactor tool. Due to the fact that many cryptocurrency exchanges have already implemented KYC procedures, law enforcement agencies were able to contact the cryptocurrency exchange operators and request detailed information about certain bitcoin addresses.
Don Fort, Head of the Criminal Investigation Division of the United States Internal Revenue Service (IRS), emphasized the crucial role of tracking bitcoin transactions in identifying site owners.
“Through the sophisticated tracing of bitcoin transactions, IRS-CI special agents were able to determine the location of the Darknet server, identify the administrator of the website and ultimately track down the website server’s physical location in South Korea.”
As a result, 337 suspects were arrested in 38 countries, including the UK, Ireland, the USA, South Korea, Germany, Spain, Saudi Arabia, the United Arab Emirates, the Czech Republic and Canada.