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00:00Lipstick tracks cryptocurrency especially as it relates to financial crime and you've been looking at this incident in particular. How exactly did the U.S. government get this Bitcoin back. Yes absolutely. I mean it's a very interesting topic. We know that Olympic were in the business of tracking the flow of funds in the block chain. And what we've seen here unfortunately is just another events in ransomware. And so analytic done some key work in order to label the addresses that were used by the dark side ransom team here on the Colonial Pipeline. This information that we were able to provide and our tools ultimately led us to law enforcement to trace the funds in the bitcoin chain and ultimately identify which wallets were used for the attack and the ransom payments. In a ransomware attack how common is it to get the money back whether it's paid in cryptocurrency or not. It's it's tough. I would say it's definitely not frequent. And also it's very rarely publicly publicly known. In fact the payment on the Redskins themselves are very rarely publicly known. I think in this particular instance some amazing work was done by the FBI the Department of Justice. And you know they were able to effectively catch that bitcoin as they were moving straight into a wallet for which they held a plate of keys how they held those private keys. It is still unknown to this day whether or not we will find out. It's still to me to be seen. So does this being paid his ransom being paid in crypto. How does that change the equation here. Because you know I know there are concerns about Bitcoin and crypto transactions being anonymous. But clearly this proves they're not untraceable. Absolutely and you know cryptocurrency there. There's there's different shapes and sizes and not not all crypto assets are necessarily identical in Bitcoin in particular we are operating on a on a public ledger public auction. Anyone with an Internet connection team consults. Which transactions are going on. What we do in the live take is is help at some some some flavor to those transactions to understand exactly where they're flowing where to and from. In this particular case the focus from our research team and identifying the addresses controlled by the dark side the attackers effectively lifted that sense of anonymous anonymity that may come with Bitcoin. So I'm curious what this means for hacker strategy going forward. Will this discourage hackers from doing this at all or from asking for the ransom to be paid in cryptocurrency. I think it's definitely a big blow for events the war and Tuckers which is of course good for our industry and good for the economy at large. Whether this will necessarily put an end to these practices is actually not certain. I think what we've seen that's their professional opinion is that you know gone are the days where operating and write ransom were required to very advanced technical skills. Today these attackers operate under a ransomware as a service model where there is one single developer in this instance dark side that manufactures the malware and the code. And then you have of the affiliates that are responsible for penetrating a victim's system or infrastructure and deploying that code as this type of activity becomes more accessible. I think we'll see a tug of war between the simplicity to run these attacks but also the strides being made by law enforcement to a controlled and. How big a blow is this to Bitcoin. Given that much of the audience the investors the supporters are excited about the fact that it is anti-establishment establishment you know and. You know perhaps you know outside of the traditional realm. I mean I would say that maybe that position has evolved particularly over the last few years where institutional buying an interest in crypto currencies have risen dramatically. I think you know fought for the adoption and the mainstream development of crypto currencies. This is good news. The fact that you know tools like lipsticks are here to make sure that you know customers are protected. But also the evidence that we provide in our tools and able exchanges and other businesses that work with crypto to be protected from laundering potentially proceeds of crime. So I think you know I wouldn't necessarily say this is bad news. Ransomware has been around a long time. I think the additional scrutiny that is being imposed by governmental having the right policies in place and this latest piece of news from from the FBI certainly indicates that you know Bitcoin is not necessarily the place to carry out these activities.

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How U.S. Recovered Most of Colonial Pipeline’s Bitcoin Ransom

Alexis Bianchi, global lead at Elliptic, a provider of blockchain analytics for cryptoasset compliance, shares insights into how the U.S. government has been able to recover most of the Bitcoin ransom paid to the perpetrators of the cyber attack on Colonial Pipeline Co. He also discusses concerns about Bitcoin's technical breakdown as well as evidence that crypto isn’t beyond government control, following the recovery of the ransom. Bianchi speaks to Emily Chang on "Bloomberg Technology." (Source: Bloomberg)

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