An Analysis of Anonymity in the Bitcoin System

Physics – Physics and Society

Scientific paper

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13 pages, 14 Figures

Scientific paper

Anonymity in Bitcoin, a peer-to-peer electronic currency system, is a complicated issue. Within the system, users are identified by public-keys only. An attacker wishing to de-anonymize its users will attempt to construct the oneto- many mapping between users and public-keys and associate information external to the system with the users. Bitcoin frustrates this attack by storing the mapping of a user to his or her public-keys on that user's node only and by allowing each user to generate as many public-keys as required. In this paper we consider the topological structure of two networks derived from Bitcoin's public transaction history. We show that the two networks have a non-trivial topological structure, provide complementary views of the Bitcoin system and have implications for anonymity. We combine these structures with external information and techniques such as context discovery and flow analysis to investigate an alleged theft of Bitcoins, which, at the time of the theft, had a market value of approximately half a million U.S. dollars.

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