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Harpoon Cannon Method: How Scammers Catch Bitcoin Whales

Bitcoin whales are considered to be people who have thousands of coins in their crypto-wallets. As it turned out, there are very few of them. Chainalysis studied the network of the first cryptocurrency and found that only 1600 addresses contain more than 1000 BTC. Probably, several of them belong to Satoshi Nakamoto, a man everyone knows about but nobody knows personally. Others may belong to a number of big Bitcoin businesses.

Nevertheless, many people who bought Bitcoin in 2010-2011 for fun or during experiments with niche industries, or who like radical anarchist ideas or are cryptography fans, fabulously got rich by 2017. The 2017 euphoria made many of them multimillionaires and even billionaires. They are called Bitcoin whales. Some of them we know from the Forbes list, but some of these people stay in the shadow.

Not all of them are active participants in the community; not all of them have successful Bitcoin businesses. Some of them just exchanged some of their Bitcoins on luxury goods. Traveling and other things that can be bought for fiat money. Their states are scattered over dozens of different wallets, the connections between which may not even exist. The Winklevoss twins, for example, have devised their own novel solution to store their crypto fortune.

However, when you trade 10-15 BTC, then security and legality are your problems, and when you need to exchange 1000-5000 BTC, it becomes a problem for authorities. Real criminals – drug lords or terrorists, for instance – have their own established channels for money laundering, and state authorities have their own methods of destroying such channels.

But what if you are a good guy but you need to exchange a huge amount of money, let’s say 5000 BTC? Even considering the bearish lawlessness of the current market, it makes (Read more...)