Turn Your Own Bitcoin Node, Urge Bitcoiners as Chainalysis Reportedly Set a Trap

Source: Twitter/bitminster

A leaked document showed that US-based major blockchain analysis company Chainalysis is running nodes to capture data and help out police investigations, prompting the discussion about the relevance of running one’s own Bitcoin (BTC) node.

“This is insane smh. TU[R]N YOUR OWN NODE,” tweeted user Druw. User LaserHodl further claimed that “an unstoppable datacenter is emerging in the homes of Bitcoiners.”

They are also referring to running nodes at home, mentioning services like Umbrel and Start9, arguing that the increasing availability of this option is replacing “centralized power brokers with an open ecosystem of Bitcoin apps,” adding: “The cost of tyranny is skyrocketing. The DecentralizedRevolution is at hand.”

These are just two of many similar opinions on the matter, as many Bitcoiners support the idea of running one’s own node in order to interact with the network more securely and privately, to strengthen the network, and to be able to prove BTC ownership by your own.

People can either run lightweight or full nodes – whereby the former is quicker and downloads only the key data, while the latter downloads all transactions to confirm them.

Bitcoin.org also states that there are many organizations and individuals who volunteer to run full nodes using spare computing and bandwidth resources, but that more of them are needed to allow Bitcoin to continue to grow. 

As previously discussed, many in the Cryptoverse have been attempting to show that setting up and running a node is not as complicated as it may sound, especially to newcomers.

At the time of writing, there were 11,540 Bitcoin nodes, per bitnodes.io data. 

The concentration of reachable Bitcoin nodes found in countries around the world:

bitnodes.io

This talk of nodes follows the emergence of secret documents allegedly written by Chainalysis, and presumably shared with Italian law enforcement. First reported on by CoinDesk, the leaked documents show that the company is running the nodes themselves so to gather data on Bitcoin users.

“Chainalysis runs a series of nodes on the Bitcoin network,” and once a user connects to one of those nodes, a treasure trove of information is revealed to the company, including the user’s internet protocol (IP) address, used and unused addresses in the wallet, and the wallet software version.

It gathers info through Simplified Payment Verification (SPV) wallets, saying: “The SPV and Electrum wallets have been designed so that the user does not have to store the entire blockchain on the phone.”

Furthermore, the company used a wallet explorer, aptly called Walletexplorer.com, to gather visitors’ IP addresses in order to assist in police investigations. The theory is that bad actors would use this explorer to check transactions, looking for anonymity, not leaving any evidence on crypto exchanges.

For the explorer’s results, the company stated that: “Using this dataset we were able to provide law enforcement with meaningful leads related to IP data associated with a relevant cryptocurrency address.” Furthermore, it’s possible to do a reverse search on any known IP address in order to identify other BTC addresses, as well as collect data from “address that has yet to transit the Blockchain,” if the suspect checks their address, said the company (per Google translation of the original in Italian).

The explorer itself doesn’t explicitly state that it is affiliated with Chainalysis, though the bottom of the website does make a mention of the company as an “even better tool” “to trace bitcoin”, as well as that the explorer’s “author […] now works [at Chainalysis] as analyst and programmer” – suggesting the site was created before the company came into the picture.

The mentioned ‘author’ is Aleš Janda, who joined the company in late 2015 per LinkedIn, while the explorer’s domain name has been registered in January 2014. The contact on the explorer’s FAQ page is still Janda. His name has been removed from the home page, where it had also once stood per a Wayback Machine snapshot.

As for other popular privacy projects, the document also has sections on tracking Monero (XMR) and Wasabi wallet transactions.  

It is still unknown, however, when the document was created or presented.

Cryptonews.com has reached out to Chainalysis for comment. 
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Learn more: 
- Ways And Benefits Of Running Your Own Bitcoin Node 
- Running Your Own Bitcoin, Ethereum, or Lightning Network Node 

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