How to track wallet ownership and operations (Clustering)

[Tyr808]

Say I create a new ethereum address and send ETH into it from my binance account.
On etherscan the only thing anyone can ever see is that "Binance Wallet" deposited the ETH in it. But noone will ever be able to know that it was me just by looking at the blockchain from the first look, yes nobody knows from where or who send me the funds.

But thanks to clustering one would be able to know.
You can analyse who is moving the wallets or who is in charge of the wallet from previous movements...like time, api etc

Can anyone explain how this technique work? What would someone have to do in order to find that out, step by step?

[jackg]

I'm not sure what is meant necessarily by clustering (what you think it is)? However, there are analytics that look at transactions that are of equal amounts (or similar). These can be grouped together, say someone sends 100 Bitcoin in a transaction, it'll probably stand out against the rest won't it for that day.

Timing is obviously important, if something is sent as soon as it is recieved, then it's more than likely the person sent coins to themselves in a hop or a service (which usually have a large amount of coins in one address).

There's also master public keys that link wallets together, I assume ether has the same.

I'm using Bitcoin as an example, it'll be the same for ether though.

[paxmao]

I'm not sure what is meant necessarily by clustering (what you think it is)? However, there are analytics that look at transactions that are of equal amounts (or similar). These can be grouped together, say someone sends 100 Bitcoin in a transaction, it'll probably stand out against the rest won't it for that day.

Timing is obviously important, if something is sent as soon as it is recieved, then it's more than likely the person sent coins to themselves in a hop or a service (which usually have a large amount of coins in one address).

There's also master public keys that link wallets together, I assume ether has the same.

I'm using Bitcoin as an example, it'll be the same for ether though.

Some exchanges make it particularly difficult to follow. With Kraken you can generate a key every time you want to transact. I think that is quite untraceable, but I would like someone with good knowledge to show me I am wrong.

[jackg]

~

Some exchanges make it particularly difficult to follow. With Kraken you can generate a key every time you want to transact. I think that is quite untraceable, but I would like someone with good knowledge to show me I am wrong.

From a legal standpoint with that, a court in their country can order the information from them which can then be used for prosecutions if that's helpful. It's probably easier for some courts to use state-funded hackers to try to get into the exchanges and link the addresses though. I assume there is a link between these addresses to see the previous ones you have used on that exchange.

There might also be the issue that the funds are all sent from the same address to a different address that end up in the Kraken's main address (in their cold storage normally).

[paxmao]

~

Some exchanges make it particularly difficult to follow. With Kraken you can generate a key every time you want to transact. I think that is quite untraceable, but I would like someone with good knowledge to show me I am wrong.

From a legal standpoint with that, a court in their country can order the information from them which can then be used for prosecutions if that's helpful. It's probably easier for some courts to use state-funded hackers to try to get into the exchanges and link the addresses though. I assume there is a link between these addresses to see the previous ones you have used on that exchange.

There might also be the issue that the funds are all sent from the same address to a different address that end up in the Kraken's main address (in their cold storage normally).

I mean, untraceable as far as being able to trace it directly to an Eth account or user. I do not consider legal requirements, and I definitely do not consider hacked evidence as suitable for most governments or legal systems.