The Giving Block Working To Identify Darkside Hacker
Image Source: Unsplash

A cyber-crime group called Darkside Hackers have recently extorted millions of dollars from profitable corporations with the intention of giving back to the less fortunate. Experts believe this is the first reported stunt in which hackers are donating stolen funds to charities around the globe. The hackers have been leveraging Bitcoin to make donations through “The Giving Block,” which is a non-profit platform where people make crypto donations to various charities. 

Hackers Donating Stolen Funds

According to a recent report by BBC, a hacker group has been extorting millions of dollars with the goal of donating to charities. The group strives to extort funds from profitable corporations, and believes they are “making the world a better place” by donating the proceeds to various outlets. Experts believe this is the first time that hackers are engaging in ransomware attacks and then donating the funds. In a report by Wired, the Darkside Hackers are very selective in terms of the companies they attack. Darkside Hackers said in a press release that:

“Before any attack, we carefully analyze your accountancy and determine how much you can pay based on your net income.”

The Giving Block – Hackers Post Receipts

In a post on the dark web, the hackers posted receipts to prove that stolen funds were going to charities. By facilitating the donations on “The Giving Block,” the group posted receipts for $10,000 each ( 0.88 Bitcoin per donation ). The two organizations receiving the donations were “The Water Projects“, and “Children International“.

Despite Children International commenting that they have no interest in keeping donations that are affiliated with hackers, Darkside believe that their work should be cherished, stating that:

“No matter how bad you think our work is, we are pleased to know that we helped changed someone’s life.”

Despite the Darkside hacker group being somewhat new, it is believed that they may be linked to big time players that have engaged in high-profile attacks. 

Processing Donations Through The Giving Block

The Giving Block came to fruition in 2018, striving to create an avenue for millionaires to take advantage of tax incentives through crypto donations. According to the report, the Giving Block stated that they were not aware that recent donations were being facilitated by criminals. The Giving Block also stated that they were working to verify that the donations were indeed facilitated with stolen funds. If true, The Giving Block plans to return the funds to the correct owners.

The Giving Block crypto donations
Source: The Giving Block

Visionary Financial spoke with The Giving Block on October 21st, and they stated that:

So far the blockchain analytics of the two transactions are not showing any links to known hackers so we are not able to confirm anything

We’re working with third party blockchain analytics firms to help dig deeper but haven’t been able to turn anything up yet

When asked which third party they were working with, The Giving Block stated they could not disclosure that yet until they know more internally. 

Transactions Can Be Tracked

In the early days of cryptocurrency, many people thought that transactions were completely untraceable. As the industry matured, transactions on the blockchain are now being marketed as an easier way to track criminal activity opposed to traditional fiat. Despite Bitcoin being transacted in a pseudo-anonymous manner, more tools are becoming readily available to combat illicit activities.

Tech firms across the country are developing softwares that help track the movement of digital assets. Some of these blockchain start-ups include Chainalysis, Elliptic, Numisight, and many others. Government agencies like the FBI and IRS have already leveraged resources from some of these companies. Back in July of this year, the IRS had awarded a contract to Elliptic to trace crypto transactions. According to a report by CoinTelegraph, federal agencies have spent at least $10 million on the infrastructure offered by Chainalysis as of February 2020.

The Use Of Crypto Mixers

It is best believed that the hackers are using crypto mixers to mask blockchain transaction trails. Despite transactions becoming extremely difficult to track after being mixed, analytics firms like Elliptic have developed software that can track whether or not transactions originated from various mixing services.

It is still uncertain if The Giving Block is working with one of the large players outlined above. 

Notice: Information contained herein is not and should not be construed as an offer, solicitation, or recommendation to buy or sell securities. The information has been obtained from sources we believe to be reliable; however no guarantee is made or implied with respect to its accuracy, timeliness, or completeness. Authors may own the crypto currency they discuss. The information and content are subject to change without notice. Visionary Financial and its affiliates do not provide investment, tax, legal or accounting advice.

This material has been prepared for informational purposes only and is the opinion of the author, and is not intended to provide, and should not be relied on for, investment, tax, legal, accounting advice. You should consult your own investment, tax, legal and accounting advisors before engaging in any transaction. All content published by Visionary Financial is not an endorsement whatsoever. Visionary Financial was not compensated to submit this article Please also visit our Privacy policy; disclaimer; and terms and conditions page for further information.