Researchers at RWTH Aachen University in Germany recently downloaded the entire Bitcoin blockchain and discovered it contains links to child pornography websites and a possible image of a “mildly nude” minor, potentially putting the cryptocurrency in jeopardy.
The blockchain is the open-source, distributed ledger that records every bitcoin transaction. Individual blocks in the overall “chain” store records of transactions and can potentially store small notes or files or other metadata—often the notes are just used to acknowledge what the transaction was for.
Users can inject the blockchain with non-financial data by encoding that data as a standard transaction. Currently, there are four services that can inject non-financial data into the blockchain: CryptoGraffiti, Satoshi Uploaded, P2SH Injectors, and Apertus.
The Bitcoin’s blockchain in question, was 122GB in size, with researchers concluding that only 1.4 percent of all blockchain transactions contain non-financial data, which consumes a mere 118.5MB of the entire blockchain volume. Even more, the transactions with data they could actually read weighed a mere 22.6MB. This is where they stumbled across the child pornography, which was approximately 1,600 files stored in bitcoin’s blockchain. Of the files, at least eight were of sexual content, including one thought to be an image of child abuse and two that contain 274 links to child abuse content, 142 of which link to dark web services.
“Our analysis shows that certain content, eg, illegal pornography, can render the mere possession of a blockchain illegal,” the researchers wrote. “Although court rulings do not yet exist, legislative texts from countries such as Germany, the UK, or the USA suggest that illegal content such as [child abuse imagery] can make the blockchain illegal to possess for all users.”
“This especially endangers the multi-billion dollar markets powering cryptocurrencies such as bitcoin.”
But the problem goes beyond child pornography: The blockchain can also be used to store pirated copyrighted content, malware, stolen personal data and/or images, leaked government information, and other “illegal and condemned” content.
“Since all blockchain data is downloaded and persistently stored by users, they are liable for any objectionable content added to the blockchain by others. Consequently, it would be illegal to participate in a blockchain-based systems as soon as it contains illegal content,” the researchers wrote.
Most blockchain models work like the original Bitcoin system. A distributed ledger is maintained by various systems acting as a node. Bitcoin miners, businesses, or just enthusiasts run a node that updates the full ledger routinely throughout the day using Bitcoin software. The miners receive newly created bitcoins by using their computers to essentially guess the solution to a complex equation, the first miner to guess right wins and a new block in the chain is created. The larger system is protected from fraud and remains consistent as the nodes verify the different versions of the ledger being sent out and agree on the overall record of transactions.
“We anticipate a high potential for illegal blockchain content to jeopardise blockchain-based systems such as bitcoin in the future,” the researchers wrote.
With blockchain’s anonymous nature, countries will need to add this technology to their list of platforms that can’t post illegal content, such as filesharing networks, newsgroups, online storage, social networks, and so on. More specifically, they need to deem blockchain data illegal that can be converted to “visual representation of illegal content” by anyone with access to the blockchain.
This is not the first time warnings over the ability to store non-financial data within the blockchain have been issued. Interpol sent out an alert in 2015 saying that “the design of the blockchain means there is the possibility of malware being injected and permanently hosted with no methods currently available to wipe this data”.
The agency warned that the technology could be used in the “sharing of child sexual abuse images where the blockchain could become a safe haven for hosting such data.”