Disclaimer: We, at f0l.io are in no way endorsing hacking or stealing cryptocurrencies. This article is purely an essay about the difficulties one faces when it comes to moving large quantities of money in and out from the Bitcoin ecosystem.
Kids, do not steal! Stealing is bad! While Bitcoin might look like monopoly money for some, it is now tied to real value, so yes, hacking someone’s Bitcoin wallet is very much stealing. So kids, do not hack!
But in case the warning above got to you a tad bit too late and you already “accidentally” emptied someone’s Bitcoin wallet with let’s say 4,736.43 BTC in it, you should read this! Liquidating the funds might be more difficult than you would think.
One of the selling points of Bitcoin is the fact that is completely decentralized and not tied to any central entities like banks or governments. During the early days of crypto this fact was widely misunderstood as Bitcoin is fully anonymous. This is only partly true. While there are ways to remain fully nameless while transacting inside the Bitcoin system, it is almost impossible to convert your coin into fiat currencies (like USD).
The issue is that most conversion between fiat and crypto happens on Exchanges like Coinbase, Cex.io, etc. Due to the “wild west” state of the ecosystem (and government regulations) these exchanges require verifying your identity before you can start trading. Even though they claim that your privacy is their priority, don’t get fooled. If they are issued a court order to hand out your transaction details to the feds, they will.
Of course you can buy a fake identity (complete with birth certificates even) on the Dark Web but at the end of the day you still need to withdraw your funds to some sort of traditional bank account, which will leave you with traditional money laundering problems.
So that leaves you with very limited possibilities, one of them being good, old cash. You can (I guess) find a guy (on the Dark Web) who is willing to meet you in person and buy your (not so) hard earned coins by handing over some cash for them.
There are some obvious issues with this:
- Not sure about your contact network but the people I interact with don’t really have $64 million laying around in cash
- Even if you find someone, that person will likely be… how to put it nicely not the most upstanding citizen of the society. Like a proper criminal. And I’m not talking about white collar, “I will hack your server” kind of criminal, more like an “I will hack off one of your limbs if you screw with me” kind.
- That person will see your face. Of course you can wear a mask, or do a Hollywood style drop off kind of deal
While it is in theory possible, in practice it would be incredibly difficult to pull off.
So you still stuck with a very 21st century 1st world problem. You have a ton of money in a currency that is increasingly more and more difficult to spend.
But here comes the good news: there are a whole heap of technologies built just to solve your issue. One of the many would be Monero, a cryptocurrency built with privacy in mind. On Monero the transactions are completely untraceable.
So here is how I would go about liberating your funds:
- Divide your BTC into small, unequal chunks. Small because you don’t want to draw attention. Unequal because you want to avoid any sort of pattern. Keep in mind that you will have to transfer each chunk one by one so the chunks should be large enough to cover the (at the moment quite large) BTC transaction fees
- Use ShapeShift to convert each chunk into Monero. Make sure you use different Monero addresses.
- Divide the chunks further inside the Monero system by transferring them around in your own wallets
- Use an exchange that does direct Monero to USD conversion, but make sure you are only withdrawing smaller amounts in different frequencies.
- Buy your private Jet (don’t do this step, feds will notice)
While the above method will work and you will get your money, it should be clear to you that the feds still can kick in your door any time. $64 million entering your bank account will raise all sorts of red flags, no matter how careful you are. For extra security you should bounce around your money through a couple of Swiss and Cayman Islands accounts.
If I have one advise for you it would be the following: DON’T!. Just don’t hack BTC wallets. Besides the fact that it’s a dick move its a lot of hassle. You will never sleep well again.
The crypto world has a lot of opportunities right now. If you can hack a wallet, you are clearly a clever fella. Just focus your energy on expanding the technology and making the world a little bit better place.
If you think thats too much effort start investing. Invest into crypto responsibly and make sure you use f0l.io to track your portfolio.