Perspectives article presents diverse views, not representing the stance of “WEB3+”.
Everyone Can Be an “Online Detective”! Is Blockchain Still Decentralized?
Following the blockchain trend analysis last Friday, we published
“XREX Analyzes Taiwan’s ‘Creative Private Room’ Chain of Financial Flows: Who Profits from Exploitation of Minors?”
Since then, we often see netizens asking: If it’s so easy to track cryptocurrency crimes, is this still “decentralized”?
️ Extended Reading:
Who Profits from the “Creative Private Room”? XREX Releases Financial Tracking Report Using Four Major Tools to Track Behind the Scenes of Taiwan’s Nth Room
I want to ask:
In traditional financial crimes, if criminal organizations have enough power, can we completely ensure that they cannot delete or modify past illicit financial flows and evidence through influence and power? Can the general public participate in analyzing these illicit financial flows?
In this case, the demonstration of blockchain decentralized technology lies in:
Anyone can analyze any transaction record without authorization or charter from any central authority.
All transaction records are publicly transparent and permanently preserved.
No matter how powerful criminal groups and illegal buyers are, they cannot prevent anyone from analyzing their transaction records, nor can they alter or destroy any record.
Blockchain decentralized technology allows anyone to analyze any transaction record without the need for authorization or charter from any central authority.
Ensuring “everyone has oversight power” is an ongoing social movement. This is the power of blockchain decentralized ledger technology; and “decentralization” is not just a technology, but also an ongoing social movement.
Perhaps in advanced countries like Taiwan, we may not need blockchain technology to grant “the right of analysis to everyone” and ensure that “no entity has the power to tamper with the ledger.” But most countries in the world are not as fortunate as Taiwan. For example, throughout Latin America and Africa, ensuring that people have the means to independently supervise society is incredibly valuable.
“Everyone has oversight power” does not mean the government does nothing; Taiwan’s prosecutors and police are good examples. Taiwan’s prosecutors and police are at the forefront globally in using blockchain analysis for judicial investigations. However, they cannot share ongoing cases because their work involves more than just analysis.
“Decentralization” is not just a technology but an ongoing social movement.
Judicial police must gather sufficient evidence to facilitate prosecutors in issuing arrest warrants, further collecting evidence. Ultimately, both prosecutors and police must amass enough evidence to convince a judge for a conviction. However, many criminal organizations have already laid out defense strategies during the commission of their crimes, such as using innocent third parties or unknowing individual currency traders, successfully evading prosecution.
As a result, the intricate and non-public nature of criminal investigations means that much of the efforts made by prosecutors and police remain unseen. The financial flow analysis report recently released by XREX is just a fraction of what we provide to the authorities.
As we embrace the power of blockchain to grant everyone the ability to analyze financial flows, let us not forget to give our prosecutors and police more encouragement. With the rapid growth of the cryptocurrency industry and improved collaboration with law enforcement, I anticipate that this year will witness numerous successful detentions and convictions related to cryptocurrency crimes.
The invention of cryptocurrencies—whether it enhances financial inclusivity or serves as the perfect tool for crime—is a debated topic. During the rise of the internet in the 1990s, we saw almost all scams shift to using email, and illicit organizations began using Skype for internal communications, evading surveillance through traditional communication monitoring by law enforcement.
Even today,
scams are widely conducted through Line; however, not all Line usage is criminal in nature.
All criminal organizations use cash, but not all cash usage is criminal in nature. Eliminating cash to combat crime would create other issues.
Cryptocurrencies are undergoing a similar process, but what sets this apart is that the decentralized ledger technology of cryptocurrencies allows everyone to participate in combating crime and enables industries to more rapidly use technology advancements to combat illicit activities.
For those interested in further understanding blockchain analysis technology used in criminal investigations, you can refer to the podcast series “Web3 Dai Xi Jin” on anti-fraud and anti-money laundering co-produced by XREX and “Digital Times,” featuring criminal investigators from the prosecution office, prosecutors from local district prosecutors’ offices, and international blockchain anti-money laundering analysts sharing their practical experiences.
