Dave Jevans, the CEO of blockchain security company CipherTrace testified in a Canadian Court as the first-ever qualified Bitcoin expert witness; the firm released the details of the court case on March 6.
He was an expert witness during a hearing involving the seizure of digital assets worth CDN$1.4 million ($1.04 million) by the Canadian police in 2015.
Jevans was allowed to testify in court as an expert by a judge of the court at the request of the Ontario Crown Attorney.
Tracing Darknet Transactions
Jevans testified in February this year in a forfeiture hearing in Canada’s Ontario Superior Court of Justice.
The case involves Mathew Phan, who is accused of illegally purchasing a handgun and trafficked guns using the world’s most popular digital asset at two darknet marketplaces.
The Ontario Attorney General wants to confiscate 288 Bitcoins.
The case started in 2015 when authorities obtained a search warrant for the defendant’s property. They searched his condo and storage locker and seized $2.5 million in narcotics including cocaine, fentanyl, and MDMA.
Further evidence found by the authorities indicating that the defendant was involved in narcotics trafficking included addressed envelopes, baggies, and scales.
After searching the defendant’s computers, the authorities found a digital wallet containing 288 Bitcoins.
Bitcoin has become one of the most used currencies on darknet marketplaces because users don’t need to reveal their identities.
The increase in the number of illicit trades involving cryptocurrencies is on the rise and requires cryptocurrency forensics and blockchain intelligence to track these transactions and identify the perpetrators.
Dwayne King, who was a Detective Constable in the Asset Forfeiture Unit and lead investigator of the crime in 2015 said that CipherTrace tools would have helped him with his investigations at the time.
King, who is now a senior manager at Grant Thornton Canada LLP said:
“I would have loved to have access to a tool such as CipherTrace when I originally conducted this investigation in May of 2015. The report prepared by Dave really was the pivotal piece in the Crown’s case for forfeiture.”
Jevans told the court that he was able to trace a number of transactions from two dark web markets – Agora and Evolution – into the defendant’s Bitcoin address.
Jevans wrote about the case:
“If I knew nothing about the case, other than being presented with the bitcoin addresses that Mr. Phan controlled, my analysis would indicate that this individual was dealing in drugs online.”
Darknet and Digital Asset Transactions
Digital assets are becoming the dominant currency of the darknet despite authorities’ efforts to crack down on illegal activities.
The U.S. government seized more than 160,000 Bitcoins in the Ross Ulbricht-Silk Road darknet marketplace case.
In June last year, the U.S. Depart of Justice (DOJ) in collaboration with other government agencies infiltrated a darknet marketplace and seized nearly 2,000 Bitcoins worth more than $20 million, cryptocurrency mining devices, narcotics, gold bars, U.S. currency, and weapons.