March 2017 Cryptocurrency Edition

Bitcoin Explained: A McCann Investigations Overview

Welcome to the Cryptocurrency Special Edition of McCann Cyber Investigations: Insight Delivered. These articles serve as an introduction to cryptocurrency systems of exchange, including articles detailing bitcoin’s blockchain and and cryptofraud. See these articles below…

  • An Introduction to Cryptocurrency

    Cryptocurrency is poised to revolutionize modern monetary practices, allowing for a universal form of exchange. At some point in the past, a decentralized system of exchange was just a musing relegated to forums populated by a handful of cryptographers; then, in 2008, some messages appeared in a cryptography forum claiming to have succeeded in creating an electronic cash system, known as bitcoin.1 In 2014, the Internal Revenue Service issued guidance on virtual currency, its own defined term, where it clarified that the United States does not grant it legal tender status but does recognize it as property and that general tax principles apply such as: Wages paid to employees using virtual currency are taxable to the employee, must be reported by an employer on a Form W-2, and are subject to federal income withholding and payroll taxes. Payments using virtual currency made to independent contractors and other service providers are taxable + READ MORE

  • Bitcoin’s Blockchain: The Distributed Ledger of Bitcoins

    The previous article provided an introduction to Cryptocurrency, as well as an outline of the current monetary exchange system. The bitcoin currency has a similar exchange system, referred to as Bitcoin, as that of physical currency, but there are some key differences to note.  The central reserve bank providing various services for bitcoin transactions does not exist. Instead, the value of bitcoin currency relies upon a publicly available history of transactions that is validated and repeated across different computers. It is continuously updated, in almost real time, and there is no centralized version.9 Independently, the computers connected to the Bitcoin network validate a transaction and the ledger is updated, without the possibility of reversal.   Access to the ledger is open; any computer can connect and become a transaction validating machine, a process known as mining, which epitomizes the decentralization in this process of validation.  Some agreed upon amount of + READ MORE

  • Anonymity and Cryptofraud on the Blockchain

    Bitcoin enables anonymous transactions between a sender and a receiver by allowing each one to know only the public key. The possibility of working backwards from a public key to a private key, in an attempt to access someone else’s digital signature and sign transactions as the private key holder, does exist but is not mathematically likely. This is mainly because determining plausibility is not a social likelihood judgment; it requires some specific methods in mathematics.15 The plausibility is dependent on how difficult computing the private key is when given the public key. The basic premise of cryptography, which forms the basis for Bitcoin, is that it should be computationally infeasible to obtain the private key by knowing the public key, “Toward achieving this premise, modern public-key cryptography derives from sophisticated mathematical foundations based on the one-way functions existing in the abstractions of number theory… two of these are factoring + READ MORE

Leave a Reply

Your email address will not be published. Required fields are marked *