Bitcoin is a digital currency that promises complete anonymity for user’s transactions on the web. Among the users of Bitcoin are speculators who hope to profit from its volatility. Others like to use Bitcoin hoping to escape from the control of governments and central banks. A third group are criminals who use Bitcoin because they think it can provide them with anonymity when they buy and sell illegal goods, such as drugs, weapons, and hacking tools.

Sarah Meiklejohn, a UC San Diego computer science grad student, began to fill the shelves of a storage room in a building of UC San Diego with strange, seemingly random objects. A Casio calculator. A pair of alpaca wool socks. An album by the classic rock band Boston on CD.

Sarah was conducting a novel experiment to test Bitcoin's anonymity. She challenged the notion that Bitcoin was an ideal way to conceal one's identity and money online. She aimed to prove that Bitcoin transactions could often be tracked, even by users who thought they were anonymous.

So, she used her random purchases to test her theory and recorded all her transactions on a spreadsheet and checked the blockchain's public records. Her goal was to find patterns that would expose the owners and spenders of Bitcoins. She was confident that she could link those addresses to real individuals or entities.

Meiklejohn manually tagged hundreds of addresses with her transactions, which were a tiny fraction of the whole Bitcoin network. But when she applied her tagging, chaining, and clustering methods to the immense Bitcoin blockchain, many of those tags revealed not just one address but a huge cluster owned by the same person. With just a few hundred tags, she identified more than a million of Bitcoin's pseudonymous addresses.

In their final paper, Meiklejohn and her coauthors stated their conclusions: The blockchain was not untraceable, but a transparent ledger could expose large portions of transactions among people, many of whom believed they were anonymous. After Meiklejohn's work, a new era of cryptocurrency tracing began, and they would not stay anonymous for long.

Possible Preaching Angle:

Hiddenness; Omniscience of God - The belief that sins can be concealed is as old as the Garden of Eden. Adam and Eve mistakenly thought that they could hide from God. In the same way, many people today believe that they can hide their activities from God and that they can do whatever they want without accountability or penalty. Their misplaced confidence will lead them to a shocking day of judgment at the Great White Throne of the all-knowing God.