Major Korean exchanges announced to "cooperate in the investigation of Room N", and the user list will be exposed

After the Telegram chat group "Room N" was exposed for shooting sexual exploitation videos targeting women and minors and charging users with cryptocurrency to spread the videos, the South Korean police sent a letter to domestic cryptocurrency exchanges and began to investigate the list of relevant members. The types of cryptocurrencies accepted by Room N include Bitcoin, Ethereum and Monero.

Sent official letters to the four major domestic exchanges, requesting them to cooperate with the investigation

On March 24, Bithumb and other cryptocurrency exchanges in South Korea said that they had received a letter from the police asking them to cooperate in the investigation of the Telegram "Doctor Chat Group" incident and had begun to investigate the relevant member list. Upbit, Bithumb, Coinone, Korbit and other four major exchanges in South Korea that have implemented real-name verification for deposit and withdrawal transactions have all received official letters from the police. A Bithumb official said, "We are currently actively cooperating with the police investigation," "but it is estimated that many users purchase cryptocurrencies through small and medium-sized exchanges, so we should not be able to find too many people."

Tracking Bitcoin and Ethereum account addresses through exchanges

The cryptocurrencies used by Room N to pay for membership fees include Bitcoin (BTC), Monero (XMR) and Ethereum (ETH). Bitcoin and Ethereum can be used to reversely trace transaction records, lock the accounts of the wallets of both parties to the transaction, and thus find out the identities of both parties to the transaction. According to a person from the exchange who received the official letter from the police, the police locked the exchange used by the suspect "Doctor" based on the wallet address of the suspect in Room N through reverse tracing, and then sent an official letter requesting cooperation in the investigation.

It is understood that there are about 100 users who use Monero to pay for joining the group. Unlike other cryptocurrencies, Monero is relatively anonymous and the information of both parties of the transaction cannot be tracked. Therefore, the payment method required by Room N from users is mainly Monero. Among the cryptocurrency exchanges in South Korea, only Bithumb and Huobi Korea have opened Monero transactions. Bithumb said that it is cooperating with the police investigation, and Huobi Korea said that it has not received any relevant official letter.

Exchange B, a Monero purchase site, seized by police for investigation

The investigation showed that some users who were not familiar with cryptocurrency transactions in the chat group mainly traded through the cryptocurrency intermediary company "Exchange B". Because the suspect had suggested that some users purchase Monero through Exchange B to pay for the group entry fee. In response, the police seized and searched Exchange B on March 20 and obtained more than 2,000 related transaction records. The police said, "In order to contact Exchange B and understand the progress of the transaction, the relevant users may have left their real phone numbers. These people are likely to have saved the sexual exploitation videos shot by the suspect."

Transactions on overseas exchanges and personal wallets are difficult to track

In addition to domestic cryptocurrency exchanges and B Exchange, there may be Nth Room users who trade through overseas exchanges or personal wallets. Although domestic exchanges in South Korea can cooperate with the investigation and list users, overseas exchanges may not easily cooperate with the investigation. A person from a company that provides blockchain tracking technology said, "Bitcoin can track user identities through dust and other methods," but "if users trade through overseas exchanges, or if people who are familiar with cryptocurrencies use personal wallets to trade with Monero, it will be difficult to track."

JOIND Won Jaeyeon reporter [email protected]