Citadel Dispatch

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EPISODE: 100
BLOCK: 785120
PRICE: 3342 sats per dollar
TOPICS: Roman Sterlingov has been held in jail for the last two years accused of operating the custodial bitcoin mixer Bitcoin Fog, evidence being used against him is questionable Chainalysis data, he admits to using the service but claims he was not the operator, Chainalysis refuses to provide background to the defense on their data, broken probability analysis could be used to falsely incriminate any bitcoiner at will

Mike Hassard on Twitter: ⁠⁠⁠⁠⁠⁠⁠⁠https://twitter.com/mikehassard
Tor Ekeland on Twitter: ⁠⁠⁠https://twitter.com/TorEkelandPLLC
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(00:00:32) Introduction and gratitude for listener support

(00:01:00) Ways to support the show

(00:02:22) Other ways to support the show

(00:03:08) Boostograms from last week's episode

(00:04:34) Introduction of guests and background on the case

(00:06:36) Background on the case and the defense's perspective

(00:10:36) Overview of the evidence against Roman

(00:19:51) Issues with the investigation and prosecution

(00:32:48) Concerns about blockchain forensics and surveillance companies

(00:46:38) Lack of depth in analysis and presentation of data

(00:47:45) Lack of access to Chainalysis Reactor software

(00:50:13) Importance of establishing the legality of using bitcoin mixers

(00:54:07) Questioning the scientific legitimacy of blockchain forensics

(01:00:23) Concerns about the profit motive and lack of transparency in the case

(01:06:56) Request for support and donations

[00:00:32] ODELL:

Happy Bitcoin   Wednesday, freaks. It's your host, Odell, here for another Citadel dispatch,   the interactive live show   focused on actionable Bitcoin and Freedom Tech discussion.   Before we get started,   I wanna thank   all of   the listeners who continue to support the show with Bitcoin donations.   Dispatch is unique in that   we do not have ads. We do not have sponsors. It's made possible solely by donations from our audience.   So thank you all for supporting the show. The easiest way to do that is by going to citadel dispatch.com/   donate. That will bring you to our geyser.fund   page.  

You can donate with via OnChain Bitcoin or Lightning Bitcoin.   You can attach   a message to that donation if you'd like. You can attach your Twitter account to that donation if you wanna climb the leaderboard. There's a public leaderboard there.   Or you can donate anonymously if you wanna donate anonymously.   I appreciate all of you who continue to support the show. You can also support the show through podcasting 2.0 apps,   such as Fountain Podcast,   Breeze,   Wallet, Podverse dot fm, echoln.com.   There's many podcasting 2.0 apps,   that you can use. You search Siddle dispatch just like you would on any other podcast app. You click that subscribe button. You choose how many sats per minute you think the show is worth, and that Bitcoin is streamed directly to my node as you listen.  

It also shows up on the geyser dot fund page,   so you can climb the leaderboard. You can see all that support. We believe in radical transparency here at dispatch.   So all donations are funneled through that geyser geyser dot fund page to my node,   and everyone can see how much this show   how much how many contributions are coming to the show. So thank you all who continue to support the show.   Also, I know it's a recession.   I know it's a bear market. If you can't spare sets,   you can support the show in many other ways. You can subscribe on your favorite platform. We're on every single platform, whether that's Twitch, YouTube,   Rumble,   every podcast app,   Twitter.  

Just search little dispatch. It will be there.   Share with your friends and family. Leave a review. All these things help. And last but not least, we do have this live chat that gets piped in   from our matrix chat, which you can find at sildispatch.com/chat,   YouTube, and Twitch. Joining us in the live chat really makes this special.   You guys are part of the show.   Your comments are streamed live and kept in our archives forever.   So thank you all who continue to participate.   And before we get started, I just wanna read   the top 4 boostograms from last week's episode.  

Boostograms are part of podcasting 2 point o. You can attach a message   with a set amount of Bitcoin,   and that kind of looks like a live comment feed where anyone can can read those messages.   And they're ranked by the amount of Bitcoin that were sent. So I'm gonna read the top 4 as I always do. We have ride or die freak, Eric 99 with 50,000 sats saying stay humble, stack sats. Great advice. Thank you, Eric. We have serious 37 with 16,000   sats saying, hi, Matt. Great show. Great guest every time. Love to listen live, but I live many time zones away in Australia.   Keep doing your great work. We have at krsh   with 15,000 sets saying courts sure are looking like a negative sum game. 1 back bad actor can take down the whole company. And then we have at fattoshi with 10,001   sets. I'll boost you, but you have to pay the nag tax. I don't think there's humans or subhumans. Some people behave reprehensibly,   but I think that systems turn people against people.  

I once got a cold call from a scammer. I asked him what he wanted to do when he was a kid. He He texted me the next day saying he quit his job and enrolled on a programming course. Yes. I'm bragging, but it's an example of the fact that people can sometimes change always.   Well, cheers to that. That's a really good message. And by the way, Freaks, I do not read them,   ahead of time. I kinda just read them live on air, so I appreciate you all. So with all that said,   I have 2 great gentlemen joining me today for a very important topic.   I was introduced to them last week by a mutual friend.  

The story is is compelling. The work they're doing is incredibly interesting. It's not in my typical,   or the dispatch typical,   it's not the typical show, but it's a very important show. And, I I hope you all enjoy the conversation   and hang out here with us.   We have Michael and Tor   who are   leading,   the defense in the Bitcoin Fog custodial mixer case. So to the freaks that might be new,   Bitcoin Fog,   was a   very popular custodial Bitcoin mixer that people used for privacy.   You would send your Bitcoin to them, to their custodial wallet, and Bitcoin Fog would send you someone else's Bitcoin to try and break the trail of on chain transactions.   And the US government,   in 2021,   arrested someone and charged him with operating, the Bitcoin Fog custodial mixer. And we're gonna get into the details here, but these two gentlemen   are leading,   his defense in that case.  

So with all that said,   let I should have introduced each of you individually first.   We have Tor here. How's it going, Tor?  

[00:06:00] Unknown:

Thanks.  

[00:06:04] ODELL:

Just for the record freaks,   these guys are lawyers. They're not professional podcast guests,   so we will not have the best sound, but it's a very important conversation.   So, nonetheless, we are proceeding. And we have Michael here,   his associate. How's it going, Michael?  

[00:06:20] Unknown:

Oh, it's going great.  

[00:06:22] ODELL:

Awesome.   So where should we get started, guys? I gave obviously, I just gave a brief intro.   How how do you guys wanna start this conversation?  

[00:06:37] Unknown:

Maybe just give   the listeners and everyone a little bit of   background   on the case and about Roman and,   why we think it's important   and why we think he's innocent.   And,   to sort of sum up everything is   basically Roman was an early adopter   of Bitcoin   in in Sweden living in Sweden.   He moved to Sweden when he was 14 with his mother from Russia,   got into Bitcoin around 2011,   Started going to Bitcoin meetups all over Europe and got into it and was, you know, selling,   you know, Bitcoin at the meetups and to friends and setting up wallets.   And then when Bitcoin   went through the ceiling,   he became a millionaire overnight, not like   huge   money, like, a couple million. Right?  

He's like, okay. I'm gonna quit my day job.   He's around, I think, like, 27, 28   right now. Gonna quit my day job. I'm just gonna live off my Bitcoin,   and trade.   And he does that. He's not making a lot of money. You know,   he's doing alright.   He starts a business, a VPN business. It goes under, and   he decides he wants to become a commercial airline pilot because he's concerned about Bitcoin's volatility,   it going up and down, and he needs he thinks he needs a skill. You know, he's getting older. Right. So he signs up I'm sorry?  

[00:08:08] ODELL:

No. Continue. Sorry. He's  

[00:08:11] Unknown:

he signs up for a,   flight school intensive in California,   and now it's 2021.   And as he's flying to California,   he lands at LA ads,   and   the government   arrests him at the border.   He's   been in jail for the last two and a half years awaiting trial.   He's been charged with running   Bitcoin Fog, the mixer for   10 years and laundering $334,000,000   worth of,   illicit   Bitcoin   funds, except the government's never tied it to a single crime.   And when they arrest him at LAX, they catch him with,   they arrest him with 3 laptops,   3 terabytes with the hard drives. He's got a bag of all his thumb drives.   He has,   notebooks with his handwritten backup codes in them. You know, he took everything with him, and,   there's not a shred of evidence   on any of that stuff   that he ever operated   Bitcoin Fog.  

There's not a shred of evidence anywhere   in this case that Roman ever operated   Bitcoin following.   They're trying to say that he set up. He did the DNS registration   Right. For Bitcoin fraud in 2011   based on this   super convoluted   blockchain tracing that involves   everyone's friend,   chain analysis.   The government doesn't have a single eyewitness to anything.   Everything in this case is just forensics,   people sitting at a desk, like, 6000 miles away from Sweden   and making guesses   and making really bad guesses.   And, Mike, I'm gonna let you fill in unless I doubt you got any questions. I'm gonna  

[00:10:07] Unknown:

let Mike Go for it, Mike. On this because it's a crazy Yeah. So this this case originally came to us through a a friend of mine out in Cape Cod   to his cousin,   who was the guy getting arrested. His cousin's Roman.   And at first, we we didn't know what to make of the case. You know? We saw all the evidence that the government had against him and the nature of it, and we did take a close look at it, and it sounded all serious. It's really important. It sound they sounded pretty confident.   And, we made a deal to go down and, talk to Roman, and we're gonna feel him out.   Originally, we thought we were gonna take this towards the plate.  

So we go down to, rural Virginia where he's been incarcerated pretrial for over 2 years now.   And, within 5 minutes of speaking with him, the first thing that comes to mind is that we realize that the guy's innocent.   He's completely, completely innocent. He didn't he did not operate Bitcoin Fog. He did not create Bitcoin Fog, and he's been caught up in this case. And a major reason why he's been caught up in this case is due to the faulty digital forensics   that have been given to the government by Chainalysis.   And   it's terrible because   not only is he innocent, but the entire process is going in the   real person who set it up is still out there.  

And, Right. Yeah. It's, it's something else. It's it's crazy.   It's a crazy   case.  

[00:11:28] ODELL:

So,   yeah. So I'll let's let's jump into   into into what evidence is being used,   what evidence is being used against him. It sounds like   it sounds like it's it's 2 sided. Right? There's there's basically 2 key pieces of evidence. It's   that that he bought the domain is what they're saying, and and that involves chain analysis, but also,   that his Bitcoin is is specifically connected to Bitcoin Fog, and that also involves chain analysis. Is that the two main pieces of evidence that that this whole case rests on?  

[00:12:06] Unknown:

Exactly.   And the connections that they make between   between Roman and and the creation of the website are are   weak, very, very weak. They have this convoluted string of transactions that the government alleges,   Roman conducted in order to fund the hosting of bitcoinfog.com,   which is the Clearnet site. Not it's not even the Tor network site that the that the Bitcoin Fog ran on. It's completely the clear net site. All it did was forwarded a link to the Tor network.   And so eve even that in and of itself is completely legal.   So we we haven't been able to come across anything, any law that he's broken through any of his conduct whatsoever.  



[00:12:50] Unknown:

And   the thing about the DNS registration, first of all, it's completely legal to do.   So even if he did do it, he didn't do anything illegal.   It wasn't they claim it was in 2011.   The statute of limitations on all these crimes is 5 years.   It's they just claim that he registered, you know, the domain name. There's no claim or any evidence that he even set up, you know, put up the the clarinet website.   They're   using Chainalysis Reactor   to say that he took money from his account   at the time   and,   mixed it and moved it   to hide the transaction that he was paying for the DNS registration, which was, like, something like $72.  

They ignore the fact that the DNS registration has since been,   renewed   twice.   Right?   They're making attributions to him   based on IP   addresses,   linked with other emails   that were used to register the DNS and also get an account on, what is it, Bitcoin?   Is it Bitcoin talk forum?  

[00:14:03] Unknown:

Yeah. Yes.  

[00:14:05] Unknown:

Where one of the alleged founders, the happy new year guy, I can never say his name in Japanese.   Was his handle. Happy New Year. Excellent. I will get that before trial. I swear to god. I will get that before trial. But,   so they say   based on,   the email addresses linked to those accounts, the Bitcoin talk,   account and the, DNS registration.   They say that that's traced back to Roman,   but the big problem that they have is when they executed the search mail on Hotmail because this,   account was, shortened at hotmail.com.   Right?  

Somebody else's name, a real person,   his name is registered to that account. And that person,   I'm not gonna name him right now, is all over the discovery, and we can't figure out why they dropped this guy. Like, there's   evidence all over the place pointing to other people. There's none showing that he ever operated,   Bitcoin Fog. The only tracing that they have he was a user. He completely admits   being a user, and even Chainalysis says that 90% of users of mixers are doing it for privacy and security concerns.   But, so he what he did is he took money from his freaking paycheck,   bought Bitcoin,   then somebody told him he should use a mixer for privacy and security reasons. So he mixes it through,   Bitcoin Fog and then   puts it in Kraken.  

Now   if you are a mastermind criminal   running a Bitcoin mixer   and laundering $330,000,000   in drug money,   would you put   your your your money in a Kraken KYC account that you put your passport photo on and your real name?   It makes no sense. And then when you start to look at these account transactions,   they're routine transactions.   They're trying to say   that they're the royalty payments   that he got   from the mixer was being deposited in his Kraken account. How come he doesn't have, like, $250,000,000?   Right? Like, the his total net worth at the time when, Bitcoin was high was a little bit south of 2,000,000.   Now, you know, the government seizes his money, the market crashes, whatever. It's at, like, 800. Now it's, you know, going back up again. But everywhere you turn in this case, nothing makes sense, and there is not a single piece   of direct evidence.  

Not one. There's no eyewitnesses   that say, oh, we overheard him in a bar   talking about this. There's no they've charged him with conspiracy, and they haven't named a single coconspirator.   And there's no,   communications.   There's like nothing. There's like nothing and we had him on the stand because they seized all his money We're trying to unfreeze the assets.   And   you know, we pointed out. We put him on the stand. It was like, you're crazy. We're like, no. He's innocent. Go ahead. Ask him anything you want. Right? And they got nowhere with him. That's hilarious.   At one point, we pointed out they didn't do any investigation into his life, his family, or anything in Sweden.  

And the government got flustered on the cross examination. At one point said to him, tell us who your friends are. Tell us who your friends are.   Okay. This is after 7 years   of a multimillion dollar investigation,   and it happens to be one of Chainalysis'   first investigations,   and one of the cases that they used to build the relationship with DOJ,   which has translated into a $330,000,000   revenue stream.   Right? You see it all over this case. 1 of the prosecutors from the case is now the senior legal adviser   for Chainalysis.  

The IRS investigator starts a private company while he's working   for the IRS, for tax you know, taxpayer salary. He starts a private company called Exigent LLC.   When Roman is arrested at LAX, there's an instantaneous press release. Right? But before the press release, actually, there's a Wired article. And our friend, Jonathan Levin from Chainalysis, is in the Wired article, very shrewdly, not saying, oh, Chainalysis worked on this case even though they're all over this case. Right?   Saying this proves   that this kind of blockchain forensics works. 2 weeks, a couple weeks later, they raised a $100,000,000   in a private fundraising, Ryan. And you can you can look at their   DOJ press releases and and and correlate them with their fundraising route. So getting back to this private company started by somebody working for the public,   on the DOJ press release, which comes out right after the Wired exclusive because it turns out they've been talking to the press   for a couple years.  

And this case is in if you know Andy Greenberg's book,   Tracers in the Dark,   you can look up Lohman in this case. Right? Of course, one thing they didn't understand or count on was I know Andy very, very well.   And so I found out anyhow, that's in a whole other freaking freaking story. So   Exigent   gets top billing in the DOJ press release   for Roman's arrest. Before everyone else, you know, at US Attorney's Office had held FBI, idiots, Swedish government, like Exigent LLC. We could not have done it without Exigent LLC. 5 months later,   Chainalysis buys Exigent LLC for an undisclosed sum, and now it has, like, a $10,000,000   plus revenue stream   from DOJ.  

What you have here is, you know, I don't think there's a bunch of people going around like, blah,   that's still roaming in jail. You but you've got, like,   careerism and a profit motive that's,   creating confirmation bias.   And we have emails in the discovery that you've got people going, gosh, you know,   you know, this might not be right. I I would hate to think,   the of the implications if if we got this wrong, and then you see them go right back to, you you you know, their thing. And they thought that when they pop   Roman   at the airport and they got all his lap laptops and computers that they they had, right, Not a trace. Right. I've been doing computer   crime law for a decade.  

I have never had a case where somebody was so good   so good that they didn't leave a trace   of what they were doing on their laptop or in their notebooks or on their phone drives.   They put him,   I could go on, they put him under surveillance when he came to the States in 2017.   They had him under physical surveillance, very expensive.   They had a wiretap going on, and they had what's called a pen trap, which just you   know what they found in there that, was evidence of him operating Bitcoin fraud?   Nothing.   Right? So then they go to cease his servers, which are Romania. They're like, oh my god. Romanian servers. Right? Remember how I was talking about that,   failed business he had? One of the things he tried to do was start a VPN business.  

So they seized the Romanian servers. I you you know, every other crypto prosecution, most of them don't go to trial. This is the first case where this is ever being challenged this kind of forensic, you know analysis at trial They seize the servers. Right? Or there's some corroborating evidence. They caught ross in the airport   Not the airport. The library, but there's laptop open. Right? Open to the admin page of Silk Road. Right? Allegedly.   Allegedly. Right. Allegedly. Right. Right.   I'm not   I'm completely. I'm not.   But   no. They they just they get a service. Nothing on nothing.  

They got no service. They got no logs.  

[00:21:22] Unknown:

Chain access was we superior the It's like they they found out that he was taking a Show up.   If they found out that he was taking a flight, and somebody made a call. And they're like, Roman's coming. Like, are we gonna do it or we're not gonna do it? And somebody was a little overzealous.   They're trapped in this, the profit mindset that distorts   justice in this case. Somebody made a call to arrest them off the plane.  

[00:21:48] ODELL:

So,   the the reason the the Bitcoin talk,   connection   is highly relevant,   even though it sounds like this connection is is weak, if not completely bogus,   is because just for context for the audience, like, the main place that Bitcoin Fog was advertised   was on Bitcoin Talk. Like, there's a lot of people that had   Bitcoin Fog signatures and was, like, join use use Bitcoin Fog for privacy, and and there was a lot of honest users in you know, completely   law abiding users   that were using it for Bitcoin privacy.   Apparently, I mean, from what you just said,   Roman admits himself that he was one of these users.  

And if   if I followed correctly,   it was basically to try and have some semblance of transactional privacy before he deposited into Kraken. So he had this Bitcoin. He was depositing Kraken. And at the time, we didn't have collaborative transaction tools like CoinJoin.   The privacy best practice was to use a custodial mixer like Bitcoin Fog before you deposit into Kraken. And there's many such cases of people doing that. There's   that 1,000, if not 100 of thousands of people that have done exactly that same exact behavior, and that sounds like Roman has admitted to to doing that part. Right?  

[00:23:09] Unknown:

He did. And what's fantastic is that when we went to   to the hearing in DC a couple of weeks ago to try to get the funds released to pay for this case, The   judge actually came out in his decision and said mixing per se is not illegal.   What the government's trying to tie him through to the Bitcoin,   talk form records is that this,   the   the individual who is related to the email address that registered the Bitcoin Fog,   Clearnet website,   the   the person who   ships with darknet marketplaces and and trumpeting Bitcoin Fog as as a, you know, good way to hide money that you're dealing with with, the drug marketplaces.   So the government all that   accusations that could play it against Roman.  

Trying to use these,   misbeated Bitcoin   or Bitcoin   talk form records to associate Bitcoin Fog with Equidmarktplaces.  

[00:24:10] ODELL:

Right.   We've seen that they we've seen them do that in the past too.  

[00:24:16] Unknown:

It's very because if you have the attribution, it's completely incorrect.  

[00:24:20] ODELL:

Right. I mean, we I just wanna know if they were correct or not in these other cases either.  

[00:24:25] Unknown:

And it it's pretty funny that the the connection that the they're making the complaint. You know, you have,   you have Liberty Reserve Dollars, which is the Costa Rican Bank at the time that was   well used for   turning Bitcoin into US dollars to be able to spend on the Internet. So it's a Liberty Reserve account that makes the payment for the website,   and they try to trace it, you know, using Chainalysis Reactive software.   And they trace it back, and they're trying to relate it to Roman's legitimate Mt. Gox account. But the first transaction   going out of Roman's legitimate Mt. Gox account with his KYC records to the first, in the series of transactions that led to the bitcoin.fog.comregistration,   they have a huge question mark in the complaint, in their graphic that they make. They don't know if and they can't prove that there's any connection back from that line of transactions to Roman himself, even though they're going around saying it like it's the truth. It's honestly ridiculous.  



[00:25:20] Unknown:

And my favorite on that front, and there's a lot of favorites in this case, is if you look in the superseding indictment, which is basically like the the last indictment they issued,   they have a asset forfeiture   allegation, which means they wanna seize   all money associated with these wallet addresses.   So they have this wallet address all the way at the end and they say there's about   1100, 1200 Bitcoin in it. So, you know, we look up the wallet address. I'm not a, you know, blockchain forensic expert, but that you you could do that.   0   0 Bitcoin in it. No transaction since 2011.  

And we say this to them and they're like, oh, no. We have got some secret, you know, code formula that where we know and everything is it's in a cluster.   Now they do a lot of cluster analysis in this case,   and,   it leads to predictable cluster results.   And one of the things we've learned coming in on on this wonderful world of blockchain forensics, this brave new role, is that it, involves something called heuristics,   which is my understanding is the Greek word for guessing.   Okay. So we're now guessing   that clusters,   of wallet addresses are allowed as a cluster and all these people are associated with it. But another thing we've noticed is that when we go across forensics platforms, the cluster attributions,   don't sync up.  

Like, one will say Coinbase,   you go to another platform, it's like whatever.   Right?   There's no   objective standards   when it comes to blockchain forensics.   And that's very dangerous   because it creates exactly what's happening here.   The Roman could be any one of you.   Just picture yourself, you've you've been, you know, whatever, in Bitcoin for   years or whatever, and you're getting off an airplane in the United States.   And they arrest you, and they charge you with crimes that, have carry a sentence of 50 years to life.   You are kept in a jail cell before trial,   and they take all your money.  

And, you know, you go through a couple of federal defenders and then somehow we show up. Right? But,   you   know, this is a really disturbing case. It's also, I think, very important as a matter of computer   law because there's,   a bunch of, as we'd say in our profession, matters of first impression.   Most blockchain prosecutions   plea out just like most things do in the federal criminal system. 90% of cases in the federal criminal system,   they take a plea.   The other 8% go to trial. And the other 8% get dismissed.   2% go to trial. And of those 2%, there's an accrual rate of less than 1%.  

To me, that's a rigged system.   I and I've been inside 10 years. You know?   But   he can't take a deal   because he doesn't know anything,   and he'd have to lie. So he's in this situation. A lot a reason a lot of innocent people take a plea, right, is because they can't afford to go up against,   you know, DOJ's got $42,000,000,000   budget,   unlimited resources. They just were spending money on this case for years. It's like starts out as this pet project of an FBI agent in Philadelphia at the Russia desk, National Security Division, who then decides to go to Georgetown Law School in DC.   So she transfers the case to DC. In case it's She becomes,   she she she transferred to DC, becomes graduates law school, becomes a lawyer, then becomes a prosecutor on this case.  

That's a problem because she's also a material fact witness, and we've subpoenaed her, and you can't be a, represent a party in a case that you're a material fact witness in. But now they're telling us, oh, no. No. No. No. No. Right?   But why else   are we in Washington, DC? And this is another really scary thing about this case that people should be concerned about.   Roman Sterlingoff lived in Gothenburg, Sweden.   At no point did he has he ever set foot before this prosecution in Washington DC.   He has no friends in Washington DC. He has no family in Washington DC. He has never done a bit of business in Washington DC in his life.   The only reason we are in Washington DC is because some IRS agents decided,   you know, oh gosh. This case has been going on for a long time or whatever. I don't know what the conversation is. But they decide that they're going to do a sting operation   on, Bitcoin Fog. Right? So they're in DC, and they send a message to, like, the Bitcoin Fog help desk.  

Hi.   We'd like to launder some illegal drug money. We just sold some Molly. Is Bitcoin Fog a a good mixing site to, you know, mix our legal funds?   No answer.   Right?   They mix some government money   and put it back in their account.   That's the entire basis for federal criminal jurisdiction   venue   in Washington DC. There was no answer Okay.   From the help of the answer. Nothing. We don't know if there's any counterparty on the other side, but they said I mean, because who the fuck would answer that anyway? But yeah.  

[00:30:37] Unknown:

That's fucking insane. What? They're turning it into a liability   crime.  

[00:30:42] Unknown:

Yeah. Yeah. There's, like, no, this is gonna go state. And   if that's right,   any prosecutor sitting at a desk anywhere in the United States can drag you to any federal court anywhere   just by sitting   at their laptop.   And that the United States Constitution says you have to have   the the the federal jury trial. Everyone's like, this is a technicality, but this is like, I think it's brilliant. It makes sense to me. You have to have the trial where the crime happened. It's called the venue clause. Because what happened in the American Revolution   is the British Crown would arrest US you know, American revolutionaries   and take him to London for a jury trial.  

Now a jury in London is very, very different than a jury in Philadelphia in colonial America.   Here,   there's not even a piece of evidence that any crime occurred in DC   except the one they say happened,   which is the government mixing money, which I'm not even convinced is a crime   because,   it's there's a government holding on to illegal drug money that they're now mixing. Like and   when we first got this, we thought, oh, okay. Entrapment. Right?   I look at the entrapment, then I realized, oh my god. Wait. There's a problem here. Entrapment's an affirmative defense. It has to go to the mental state of the defendant. The entrapment defense is saying, oh, yeah. I did have the requisite   mental state to commit the crime, but the government coerced me into it. Then I realized the problem is we don't have anybody with a mental state on the other side. Right?  

And   what Mike was getting at when he was saying it's a strict liability thing, and this is a little technical, but it's another scary aspect of this crime. They're erasing   what they call the mens rea intent requirement,   here in this case. And I see this yeah. The guilty mind. Mens rea means guilty mind in that. Right?   They're taking that out of the equation, and that's been in our criminal law for centuries.   And when you remove that, and I see it happening in other community cases that you're trying to do in other community cases too. When you remove that,   you just removed   one of the most important elements in a that protects   the innocent   from abusive   prosecution.  



[00:32:48] ODELL:

I mean, so there's a lot there's a lot of troubling shit here, and there's a lot to unpack here.   To go back,   on on the Chainalysis   side,   so   I do a lot of work on   Bitcoin privacy best practices and on chain forensics and,   tracking Bitcoin.   And to be clear, like, the   I I think you nailed it, but the the word they use is heuristics,   and they use the word probability analysis.   Right? So this idea that with Bitcoin, unlike something like Venmo,   Venmo, I can't send money to myself. It just was like, that's ridiculous. Why would you wanna send money to yourself? But with Bitcoin, you can send money to yourself.   So a a tracking company's,   quote, unquote, job a surveillance company's, quote, unquote, job is to try and figure out what the probability of,   of a transaction is is changing hands between ownership and and trying to track where that ownership change happens and who has the new ownership.  

And it's purely a guessing game. That's why it's called probability analysis. It's, you know, it's what is the probability   that this has changed hands. And then they try and cluster it among owners,   using those heuristics and that probability analysis. They say, okay. This is the Odell cluster. This is the Coinbase cluster. This is the Mt. Gox cluster.   So when so and and this seems completely apparent to me from what you've said that Chainalysis is essentially using this as a fundraising tool and a   as a way to kind of show credibility to to what is   a faulty product. A product that is is is solely based on probability analysis and solely based on guesses and doesn't have any concrete answers. And as a result,   of that situation,   you have you have what amounts to vague evidence that can then be   placed however you kind of want to make the perspective be placed. And you can and you can basically   insinuate guilt on someone who might not be guilty in that situation. And that applies to all big corners,   regardless of if they're   committing a crime or not committing a crime. Now I'm curious when Chainalysis   submits this   bullshit analysis, their their report or whatever with the clusters and and whatnot,   what what do you guys get to see? Like, what does the defense get to see? What does the the the person who's being charged get to see? Is there any you know, there's other competing surveillance companies that are constantly competing. Are they involved in the court case? Do you see, like, Elliptic's   version of the events? Do you see chain analysis version of events? Do you see Coinbase's,   and Coinbase surveillance, whatever they fucking call it? They have their own product. There's a bunch of different products. Do you see all these other ones as well? What do you see from the chain analysis side? Like, let's go into that a little bit.  



[00:35:44] Unknown:

Now it's interesting that you say Elliptic because the IRS agent who created the Exigent company that Tore was mentioning earlier,   he actually worked for Elliptic before he started working for the IRS. And from what we can understand is that the the software developed by Exigent seems to be very similar to the the software that was used by Elliptic. So I think on their side, there's some conflict between them   on that front.   But we we've run-in we've just been stonewalled everywhere we've gone. We want to look at the code, the Chainalysis Reactor code that was able to identify these clusters so that we can troubleshoot them, have our own experts come and look at them, and make compelling argument as to why they're incorrect.   But the government and the analysis have refused to disclose   that to us, and we're in a in a battle with the court right now over whether it needs to be disclosed.  

Separate from the code that we're requesting,   we wanna look at the input datasets that they put in to the Chainalysis Reactor code because we have reason to believe that those datasets are incorrect.   And this goes back to, the Mount Gough's records that are included in part of this,   this case.   The original,   IP matching   that the government says, that whoever created the bitcoinfog.com,   clear net website,   that they the IP with that matched with   IP that Roman used to log in to his,   KYC   Mount Gox account back in 2014,   2014, 2013.  

Now,   the records that they're relying upon and this is public information from Andy Greenberg's book. It's on pages 104, 105 of this book. It talks about   the, the Mt. Gox hack and how after losing the, $400,000,000   roughly of what of what McGox lost in the hack,   somebody steps up and says, hey. I can trace this. And it's this guy, Michael Groeninger, trying to create this company, Chainalysis,   and Chainalysis was built on trying to identify the perpetrators of the Mt. Gogs hack. And there's there's a anecdote in the book where,   Michael Groeninger goes to Mark Karpeles,   the CEO at the time of Mt. Gox, and says, hey. Can I have all of your data?  

Mark Karpilis gives him an an encrypted   hard drive.   And Michael Gruninger comes back and says, there's all the information is mixed up on records like what happened here. Mark Carpilos suggests that it's possible that there was also a physical hack of the Mt. Gox servers and that they messed with all the data. So and they didn't have any backup. He'd messed to not have any backup for the Mt. Gox records.   So these records that the government is using in Roman's case are the same records   that, Michael Groeninger was given,   at that early time during the Mt. Cox hack to try to figure it out,   and they're completely incorrect. And we can show they're incorrect. Like, when we take a transaction ID and we put it into a blockchain review program,   It   does all the transaction IDs are mixed up. Some of the wallets don't exist. Other ones do exist. There's some transactions that are on the public blockchain, but it's all mixed up and and unreadable and unreliable.  



[00:38:43] Unknown:

And one of my favorite things, go back to Mark Dallas or Pius, however you say his name for   the.   Is that he was   convicted in   in Japan?   Japan.  

[00:39:03] ODELL:

You're breaking up a little bit, Tor.  

[00:39:06] Unknown:

My my mute is going crazy.  

[00:39:09] ODELL:

It's Was your computer, like, dying on you?  

[00:39:13] Unknown:

It's my, Bluetooth headset,   keyboard, I think. Can you hear me now? We can hear you now. There you go.   Yeah. Fuck that keyboard. I think I pressed   yeah. Fuck that keyboard. I turned it off.   Going back to Mark Capellas, one of my favorite things is that, Mike, there's so much stuff in this case. Like, every corner you turn to, there's something interesting. So Mark Kapalis, Kapalis, whenever you say his name, right, who provides   the source data pointed up for,   what they're doing is IP   address,   attributions   and everything.  

He's convicted in Japan and sentenced to 4 years in jail for wait for it.   Falsifying   Mt. Gox   data.   Okay. Yep. So that's answers one question about, like, what the source is like. And and, like, Mike's right. They've been snowballing us on stuff.   Bread sheets that don't have the original data on it. There's indications with the investigators expressing doubt   and then kinda looking away. And you also see   a lot of people because it sprawls over 7 years,   you see people coming in and out and not really giving a shit.   Right? Like, close enough for government work.  

There's typos and wallet addresses and, you know,   the whole thing.   Finch   says   must be getting DDoS, but I think that's just my shitty spectrum Internet.  

[00:40:39] ODELL:

It was a nice anyhow. It was a nice pun because Tor the Tor, the privacy service is getting DDoS constantly for, like, the last 7 months.  

[00:40:48] Unknown:

That's It's my real name. It's my real fucking name.  

[00:40:52] ODELL:

I thought I thought you changed it to be on brand, so I'm glad we got that out.   Wait. So so just to be clear,   in Bitcoin circles,   like, we know we can't trust any of the Mt. Gox data. We know that he was completely incompetent, if not straight up fraudulent.   We know he lied many times,   at least at at the very least about the scope of of the situation and operated it,   insolvent for a while if if he didn't actually steal the money himself.   But what you're saying is the data from Mt. Gox is basically the seed data for starting chain analysis.   And I I   and just to even go even further than that,   something we talk about on the show a lot is the danger of of KYC and regulated services   in that these services are essentially providing the datasets   that are used in all of these different tools.  

When they're trying to connect all these clusters and whatnot, its IP addresses, its transaction IDs, its names,   its home addresses, all connected from all these different   exchanges. Some of them are shadier than others. You know, there's no real checks on the credibility of those services.   Sometimes people might be using,   stolen identities,   even in in these situations, and they're all kind of inputted directly in. But   I had never known until I spoke to you guys that Mt. Gox was essentially that dataset was this it was the seed dataset for chain analysis at this  

[00:42:24] Unknown:

beginning. Yeah. It's, and that's in Andy's book, you know, tracers in the dark. And it there was only one dataset. I mean, Groninger asked, is there a backup? And   is like, no. By the way, Mark Copeland has been seems to have been working with the United States government now for years, and as far as we know, is still   working with the United States government. And I am of the opinion that there's more evidence   that he ran   BitcoinFog   than,   Roman ever did. Roman doesn't even have coding sites, something like that. Like like,   it's there's this huge cultural   disconnect   between the world and the investigators   that they have these really kind of,   like, naive   view   of the culture and the world and all this stuff that's normal   in the culture.  

You know, Bitcoin culture is, like, exotic and foreign to them.   And, you know, they have this psychology, and I think that's one of the harder things   to deal with in this case is these entrenched   psychologies   where, you know, Bitcoin is evil. It's mysterious, and only criminals use it. And,   it it's it's   it's fucked up because   criminal prosecution should be based on logic and rationality, and there's a a really deep,   deep vein of irrationality and superstition   running through this case. You know, darknet.   Boo.  



[00:43:54] Unknown:

It becomes very obvious language they use throughout prosecution.   The dark net   and repeatedly saying things in ways that   make them look a lot worse than, you know,   xenophobia point out of DOJ and the fact that he's sitting in prison right now rather than being able to prepare for his trial personally with us in New York City.   He's sitting there in part because he when he was arrested, he had 4 passports.   When the judge is deciding, and the court's deciding, whether or not they're gonna lock somebody up pretrial, it comes down to either, a, if you're a threat to the community, if you're wild, you're gonna hurt somebody, or b, if you're at risk of flight, gonna go to a foreign country, if you're gonna run away.   And for the justification of flight, which is why he's currently in prison,   incarcerated in pretrial, They used the fact that he had 4 passports. Nobody could get over the fact that there were 4 passports. They must be fake. But, of course, he was born in Russia.  

He moves to Sweden with his mother when he's 14.   Basically, lives in Sweden,   his whole adult life.   So Russia has 2 passports. They have one for traveling internally within Russia and a separate passport for Russians to travel internationally.   And then Sweden, they're pretty internationally oriented, so they give you a passport as well as a backup passport in case the first one gets stolen or you go to a country that another country is not gonna let you in if they see the stamp.   So he had 4 legitimate government issued passports, and somehow that still becomes, like the darknet, some   idea, some negative idea, all these negative connotations that, oh, you got 4 passports. You must be a crazy cyber criminal. And you see that in the government's pleadings. The xenophobia and the this this confirmation   bias is it believes through their entire prosecution.  



[00:45:36] ODELL:

Yeah. I mean, that's fucked up. So, I mean, just to go back to the chain analysis stuff, so what do you actually get? Do you get, like, just, like, a flowchart?   Like, are you getting, like, a PDF that's just, like,   this is Roman operating Bitcoin fog? Like, what, like, what are you are you getting,   an anime like, what are you   getting?  

[00:46:01] Unknown:

Yeah. Well, we're getting we're not getting much. You know, we thought that we'd be getting yourself files. We're gonna be getting, videos and stuff. They have these convoluted,   like flowchart maps that they use making X Mind or something like that. And they just have incomplete wallet addresses pointing to other incomplete wallet addresses.   They're they're pointing to collectors that have short firm yet shorted names   that you can't look up without the chain office reactor software.   They're not showing any of the math or any if you use something like like breadcrumbs.app,   that's a great,   software tracing tool. And, shout out to them. We work with the CEO a little bit on this case, and they're a great program.  

But,   on that, you can see where the money is flowing from one wallet address into another one or if there's, a coin chilling going on. They don't have any of that depth to their analysis or presentation   of the data that they suggest was used against Roman. In fact, some of the their biggest stuff that they keep putting everywhere and posting up and putting in their complaints and their superseding indictment, like I mentioned earlier, they have a Roman's mailbox wallet, then a huge question mark, and then a series of transactions that were used to pay for the bitcoinfog.comclearnet   site. So the connection to Roman is absolutely nil.  

It really looks like they've got that IP match between the Mt. Gox account, which came from these,   inadequate, in my opinion,   Mt. Gox records. And the IP address used to register the ClearNet site, they got that early on in the investigation, and I don't think they ever stopped looking away from Roman,   even though as they continue to build the investigation,   we can see that it becomes very clear that Roman didn't do what he's being accused of. And then instead, it appears that there's this other actor or actors who who more likely were the perpetrators.  

[00:47:46] ODELL:

Did they give you do they give you access to the Chainalysis   Reactor software? Like, can you use the software? I'm not talking about source code or anything. Like   No. We can't. They want us to buy it. This is proprietary. We have to give the money to use it. Well, they don't even sell it to anyone. Like, you have to, like, talk to their customer support and, like, have them approve you to sell it. Like, I it's not even something money can buy in my understanding of it. It's like they only have approved clients.  

[00:48:14] Unknown:

Yeah. It's it's   it's crazy. You know, we we have no access. It's almost like,   the wizard hanging up behind the curtain   telling us, oh, Roman's guilty. Roman's guilty. We're like, okay. Let's take a look at the software that you're using. Let's take a look at the source code and input data that you're using to reach this conclusion.   You can't look at that. That's proprietary software. We're not gonna give this to you. And DOJ is backing them up. DOJ is supporting them.   They're supporting one another. It's it's it's incredibly terrible.   Meanwhile, we have an innocent person sitting in prison facing 50 to life.  



[00:48:50] ODELL:

And they could they could they could've done the same exact thing to pretty much any Bitcoin Fog user. They could've probably done to any Bitcoin user. Like, if someone had transacted with someone who was a Bitcoin Fog user, they probably could've pinned it on them too if they wanted to.  

[00:49:04] Unknown:

And that that was it was really interesting, when we went to the hearing in DC with on our motion to release the seized funds. Because not only did they lock him up, of course, they took all of his money so he can't defend himself.   We're going into debt. We're going heavily in the red trying to fund this defense.   And so we're over there, and the   we're able to establish, in in some ways, especially by putting them on the stand, that there's a lot of doubt in the government's case.   But the standard to release the funds is that,   is only that of proper to keep the funds is only based on that of probable cause. So the fact that there was a grand jury indictment against Roman meant that there was already a fining of probable cause, which, typically,   probable cause is the standard use to make an arrest. In this case, it's the standard use to for the government to maintain control of all the seized funds,   which that in and of itself is is pretty difficult to deal with.  

But even though we were denied access to the funds, there was the positive element that that came out where the judge does appear to have seen Witt or Roman come out on the sand, which is very rare for defendant to come out on the sand. Typically, you're gonna wanna advise your clients,   you know, maybe if you if you're on the stand, something could come out, but here, we're not worried at all about anything coming out. And I think the judge understands that   In his order, it was the first time that any article 3 judge has specifically articulated that mixing in and of itself is not illegal.   Being a user of of a service like Bitcoin Fog is not illegal,   and that's big because we're we've been trying to find a statement from that in a different article for you judge this whole case, and this is the first one that we've been able to to get out.  

We were looking at a lawyer.  

[00:50:41] ODELL:

I'm not a lawyer, Michael.   Like, does that   is   does does that, like, hold up now? Is that, like, official precedent? Like, how does   if a user of a mixer,   can it can someone still be charged for using a mixer in the future?  

[00:50:57] Unknown:

Obviously, that's not what this case is. I think they're I think they're indicating that they're not going after users.   You know, they're they're going after they're targeting   the Bitcoin Fog operator, and they're the what they're bringing out in this prosecution is they're trying to tie it to the drug market   Fog, is tied to drug marketplaces.   That's counterintuitive and counter what counter what,   chain analysis even come out saying that 90 plus percent of all the money going through Bitcoin mixers was used for legal purposes.   We're just people trying to secure their own private funds.  

They recognize that, but then they come out on the other side, and they're supporting this prosecution.   And the prosecutors, when we brought that up, they had a difficult time combating that at the hearing.  

[00:51:43] ODELL:

Yeah. I mean, chain analysis literally has reports where they're saying the majority is an illicit activity,   which is it was interesting that they would even admit that because they seem pretty corrupt. So,   I don't know why they   maybe they admit that because they need Bitcoin to not just be straight up illegal. They they they need to be able to pin individuals with their tools.  

[00:52:06] Unknown:

And,   also, that's a justification for the statute of limitations not lapsing.   So they're saying that because Bitcoin Fog was still in operation and was continuing to bond their money for these darknet drug marketplaces,   therefore, the conduct even though the only conduct that they could even,   like,   partially even accuse of being Roman was just the setting up of the website 10 years ago. They're saying that it's a continuous course of conduct and that it's been going on for 10 plus years. And that because the conduct is continuing in within the statute of limitations, that the prosecution's legitimate.   We completely disagree with that.  



[00:52:41] ODELL:

When did,   when did Bitcoin Fog actually stop functioning?  

[00:52:46] Unknown:

Do you know? It it's still functioning.  

[00:52:49] ODELL:

The government election right now?  

[00:52:51] Unknown:

The government election said it stopped it stopped operating once they arrested Roman, but you can go to the Bitcoin Fog Tornett website, and you can create an account, and you can send your money through it, and it works.   So for the government to say that is is ridiculous. So what the fuck?  

[00:53:07] ODELL:

That's for that's even more ridiculous.   Yeah. And I'm lead on that one. We're 55 minutes into the fucking conversation.   So it's still working, operating right now. Still working, so for 2 years.  

[00:53:19] Unknown:

It's still up. Yeah. And and the   the, the Tornad   address notes have been have been changed since then. So somebody's been working on it while Roman's been locked in prison.  

[00:53:29] ODELL:

Right.   Damn.   Fuck.  

[00:53:34] Unknown:

Yeah. It's it's a tough one.   When we are talking about the,   the heuristics   and Chainalysis Reactor legitimizing itself, because, like you mentioned, the the clusters can be identified differently based on which programs and which groups, and companies are doing the clustering.   They actually had a a and I think that this is an effort to defeat us in a in a Daubert challenge, for which we're going to have a hearing on June 16th this year.   And Dauber challenges on the scientific legitimacy of the methods used in the digital analysis.   They actually went to Sarah Micheljohn, who is the leader in this kind of research. She's a professor in England, and her students, particularly one George Kapos, who's a contractor   for Chainalysis,   to do an investigation into the datasets used in Chainalysis'   analysis   of   this case.  

So they have a whole white paper on the analysis of Bitcoin Fog and the heuristics used and input data sets and the clustering methodologies,   and they drew the conclusion that it can't be a 100% correct. That was more or less a guess, that it that there's a a wide margin for error. And then they went and presented that at the USenix Security Symposium in Boston in August of last year,   and   that's a big one too. But I think they're gonna come back and and try to use that as justification for that. They have some kind of scientific review   of it, and that even though it's not 100% accurate, that it can be used to point you in the right direction. We don't we disagree. We don't think that's good enough for this kind of digital forensics.  



[00:55:07] ODELL:

So, I mean, I assume, like, one of the main priorities of this case or or one of your main priorities is   highlight the illegitimacy   of this as evidence in the first place altogether.   And then,   also, like, try and open the black box that is chain analysis. Right? Like, this I mean, it's is there any precedent there and and any other kind of evidence where, like, the defense doesn't have any idea, like, how it works?  

[00:55:36] Unknown:

We haven't found anything like this in the in blockchain analysis. You know, like Tory was mentioning earlier,   all of the previous,   blockchain cases, they go to a plea. You know, they're not being challenged at trial in the same way that this case is because, ultimately,   the people who are being accused probably did it, and they're trying to find the best deal that they can get. Whereas with Roman, he's a 100% innocent, and we're taking tooth and nail or fighting for him in trial, which hasn't been done before.   And, when you talk about the analysis,   it's interesting that there's a book by Chris Fabricant, who's with the Innocence Project, called Junk Science,   and it discusses how new types of digital forensic that come out   often lead to, wrongful convictions, and that's a big part of what the Innocence Project does. So we've been working with them a little bit, they're great,   and Chris Paprikaans' book, John Sizer, he talks about   how when fingerprint analysis first came out and the people who were analyzing fingerprints,   you know, they would find the fingerprint that looks similar to the one that was found on the murder weapon or something, and they'd come in as an expert opinion and say, the fingerprints match when they may not have, and they led to serious amount of wrongful convictions.  

And this pattern happens every time there's a new development in digital forensics.   This happened with hair follicle analysis,   dental record analysis,   even DNA analysis.   So I think that this development in blockchain forensics is part of that same thread in the development of digital forensics in the court.  

[00:57:05] ODELL:

So there is some hope there.  

[00:57:08] Unknown:

I think there's a lot of hope. I think there's a lot of hope for that one. Yeah. I think there's a lot of hope for them too. I mean, it's not it's an uphill   battle. You know the statistics, but this is a a very unusual case. And   one thing about it, like, you can tell, it's kind of   when you get a big important case like this, one of   the earmarks   of   a case like that is that everywhere you turn,   there's a big   constitutional issue for appeal.   Like,   just the question of why we are in Washington, DC,   implicates the Constitution's venue clauses.   There's   important questions of mens rea and attribution.  

There's huge evidentiary battles about the authenticity, like we talked about the Mt. Gox data.   And as I'm sure, you know, as Mike was pointing out, there's no objective standards   for this kind of analysis.   And there's all there's a bunch of people making money off of this.   And that that that's what Chris Fabricant's book talks about   is how you get a new forensic field.   Everybody rushes in to make money.   There's no standards,   But, you know, the government money, that's a spigot of money.   That's a huge chunk of money. And it's this the, you know, Chainalysis'   relationship   with law enforcement,   particularly the UK Serious Crimes Office   and the United States Department of Justice is   really how it goes from, at the beginning of this case, a company with no market valuation really,   to one now with a market cap of $8,600,000,000   And they do that   by   networking   and working very intimately   with the government investigators.  

And this case tells that story,   and you see it happening.   And now that we're calling them out on it and we're issuing subpoenas,   they're refusing to show us anything.   But listen, man. If you wanna put somebody in jail 50 to   life based on your commercial proprietary software that's made you a multibillion dollar company,   the United States constitution requires that you show it to the defense.   And and if it's so fucking great,   why are you so scared to show it to us?   Oh, it's proprietary. We're not gonna leak it. Don't insult me with that crap, man. I've been a criminal defense lawyer for a decade. I've never I've worked on national security cases, all sorts of cases.   My evidence doesn't leak. That's bullshit.  

But I know that if I see it,   what I'm gonna see   is this heuristic guessing game crap   and something that's never been peer reviewed   and that you cut corners on because you wanted to make money.   And And that may have worked with all these other cases where you got corroborating evidence, but you don't have it here,   yet you've doubled down.   And I would not be able to go to sleep at night   knowing that my product had put an innocent man in jail, and he's been in jail now for a felony jail sentence waiting for time.   This case pisses me off.  



[01:00:24] ODELL:

They they essentially created a bullshit product that doesn't actually work   and then they manufacture   demand for that product through lobbying   government officials. Mediocre product.  

[01:00:35] Unknown:

It's a mediocre product that hasn't been peer reviewed   that requires   external empirical   validation. They even admit that. Because the thing about this software, and this goes back to the superstition thing, it was like, oh, computers are magic. Right?   Okay. A tracing software is not an ID software,   but people do this psychological   switch in their heads. They, like, oh, they traced the transaction. That must mean they ID'd somebody. No. You've traced a fucking transaction on the blockchain. You don't know   who's on the other side of that. And they even admit you need to have some kind of you know, supposedly, they catch Ross in the, you know, Alameda County Library with his laptop open. Right. Right? In another case called Harmon, the guy took off his Google   glasses because he's an idiot. He's wearing Google glasses, and he accidentally took a picture   of the admin panel to the site that they prosecuted him for. You look at every other case, you will see a piece of corroborating evidence, and that calls into question to me how important chain analysis was   to what actually happened. Here, you don't like, you just don't have any of that.  

And and I'd I'd like people to look and tell me if you see something. Because everybody be bringing on this case, we say, please tell us.   If you see something that makes you think he's guilty, tell us right away because we wanna know.   And everybody just works who works on this case, just gets pissed off and works on it hard.  

[01:02:06] ODELL:

Yeah. I mean, I think in the Harmon case   the Harmon case, he plead guilty.   Right?   The helix.  

[01:02:15] Unknown:

Yeah. All these cases are pleading guilty. No one's taken this Ross Ross plead guilty.  

[01:02:20] Unknown:

He plead down. Ross went to trial. Ross and then he got, He didn't plead guilty?   They I think there were negotiations, but it went,   the trial was crazy.   They,   but no. He went to trial. So Ross is a good there's like 2, I think, toll that went to trial. But,   Ross's   problem,   I had talked to Ross,   was that they   allegedly,   nailed him in the library, like, in real time.  

[01:02:49] ODELL:

But that just, like, sounds like to me, that sounds like parallel construction. But, I mean, we're not here to talk about the Ross case.  

[01:02:55] Unknown:

Don't get started on that one. Yeah. Yeah. And you got the corrupt,   government agents in Ross' case. You got, like, you had 2 of them, like, dipping into the till.  

[01:03:04] ODELL:

Right? Like, I I don't And they got charged and and convicted, I believe. Like, that's Yeah. Sealed and done.  

[01:03:11] Unknown:

Yeah.   Yeah.  

[01:03:13] Unknown:

I,   yeah.   Ross.   That's they he's they got him out of Supermax. Right? Like, I heard that he'd been transferred. Like, he was I talked to him when he was in the,   Supermax.   And  

[01:03:25] ODELL:

I don't they so   so, I mean,   I'm glad that we're gonna have you speaking at Bitcoin 2023 on the open source stage and present the story.   But in   2021, we did the first interview of Ross ever since he got arrested,   at Bitcoin 2021   in Miami,   and they gave us full permission to do it. We had to go through, like, a shit ton of hoops to get the interview.   It was a prerecorded interview.   As soon as we aired it on stage,   they threw him in solitary as punishment.   So they, like, they made us jump through all the hoops. They pretended it was approved and everything. And then as soon as it fucking went on when and when as soon as it got aired, they threw him into solitary.   So there's so many shady, fucked up,   vengeful things that happened in that case, and it's just a massive tragedy,   in my opinion.  



[01:04:21] Unknown:

Oh, yeah. And and and you're seeing that pettiness is very common in our prison system.   Like, for instance, with Roman,   they've locked him up. The last time we were down there, we're going in and, you know, you go through,   you're in there. You have to bring out your pockets, and one of us at Big Mike. 1 of us had a pack of cigarettes.   Right? And they're like, oh, you can't bring that in. Okay. So, like, cool. We we lock it up in the locker. We go in there. We work with them. You know? It's just an option.   Alright. And, like, you stay in this light hotel, you get bodies in and then, you know, you go to the prison because it's nowhere.  

And then we get this, like, email saying that we'd after we got back to New York saying we'd, tried to smuggle contraband into the jail   and that they were restricting our visits with him,   you know, to just as like plexiglass   things can't really, like, full   That's shit   they decide all the time. These tiny little things   to throw up roadblocks and increase transaction costs. Right? And then what? You could go see him? Yeah. Right. Hey. I had to now go litigate all this bullshit about access to my client who hasn't been found guilty, that's been holding in a rural Virginia prison,   you know,   like, recording our phone calls,   everything. Right?  

It's frustrating.  

[01:05:43] Unknown:

But this No big change. COJ  

[01:05:45] Unknown:

has gotten too big.   And another part of the problem is is that there's,   more law enforcement agents than there are crimes.   So you've got a bunch of people in an agency with   a $42,000,000,000 budget,   some of whom who need to justify their existence.   So they go looking for stuff. And they get criminal statutes that were modified in the 20th century   that, give, like, a lot of latitude to prosecutors.   So they just fucking start,   prosecuting   away.  

[01:06:19] ODELL:

I think your Bluetooth keyboard might be acting up again.   But we heard most of it. That's why I didn't stop you.   I just wanna say to the freaks again and to the audience,   this is a very important conversation.   You know how I feel about remote conversations. I prefer to have things in person in the studio.   But it felt like this one time was of the essence, and it's important regardless of the sound quality,   to get this message out there and get this out there.   On I mean, on that note,   like, what what can Bitcorners do? Like, what how how can we help,   Roman? How can we help you guys?  

I mean, this seems   seems like one of the most important things that that at least big corners in America should be concerned about and and should be trying to help. And how how can we help you?   Now we can't hear you. Why don't you You're  

[01:07:18] Unknown:

you're back. You're back.  

[01:07:20] ODELL:

Okay. Continue. Continue. Program.  

[01:07:23] Unknown:

Like, I'm in downtown Brooklyn. I I pay all this money for my Internet, and I don't have shit.   One thing that would really help, like, we we need donations. Like, we've I borrowed money. We're we're out,   like, we're behind on our rent working on this case.   The government and the court appointed us what's called criminal justice act, which you kinda get some money, but,   because there's so many January 6 cases down there,   they won't be able to process that paperwork probably until after the trial is done.   If you go to our website,   which is just torreechling.com   or on Twitter, you'll see you know, you can get a link to it from my Twitter feed.  

Feel free to donate because we'll use the money to defend Roman.   Also, just raise awareness about it   and think about it. And if you see something that you think we may have missed or you've got, you know, some insight,   we've found community input, like, extremely valuable.   And we're really grateful   to the community   for being so supportive.   Mike and I actually on Sunday,   we're going to europe to speak at a bunch of bitcoin medots   because   everybody's   rightfully getting concerned. So it's   raise awareness about it. Reach out to us if you see something, you know, if you see something, say something   kind of thing.  

You know,   whatever you can do. We just appreciate the support.  

[01:08:52] ODELL:

Yeah. So to the people listening, that's tore ekeland.com.tore   ekeland.torekland.com.   There's a link right there that that says donate to support Roman.   And it looks like you guys accept   both dollars   and bitcoin.   Yep. Looking forward to the cluster that forms from that Bitcoin donation address you guys have right there.  

[01:09:21] Unknown:

They're watching us, and there was this funny moment. You know, we've we've had this This is great. And there was this funny fucking moment   where,   you wanna tell it? Why don't you tell it? Actually,  

[01:09:35] Unknown:

Yeah. So so we're tracing down,   you know, the government sees the accounts of the government,   at least, can allege that related to Bitcoin Fog, but Roman had other other accounts,   and they were just small accounts on, you know, small   exchanges or wallets that he had just had since 2011,   and now had accumulated to be, you know, enough money to be meaningful towards the case.   So there was one wallet, called Jax Wallet, and we were able to get the password, and we were able to figure out and get into it. And we get about   about $40,000,   something like that, in Bitcoin, and we transfer it to,   the firm's wallet address. We declare it on his financial statement. We do everything above board on how it's done. But the prosecution, not realizing that this was the transaction that we had claimed and made them aware of, They, in open court,   start mentioning all the money coming into the case. Oh, you got $50,000   in the last week or something like that. And it's like, well, yeah, that's Roman's own money that he's using to pay for   what is way more than a $50,000 case. The case like this   to have experts and the lawyers and to run back and forth from DC, go to rural Virginia jail, it costs about $1,520,000   in total.  

And   as that, but the government seized it from them. Right? And it was just hilarious when it seems like every time they accuse us or something or bring it up in court, there's, like, this really mundane, innocent   answer,   and and they just look terrible when they make these accusations against Roman, against us.   You know, it's it's kinda funny, because there's been there's been a couple of those moments where   they say something like this, and it it just turns out to be so funny.   I mean, it's not funny. I was locked  

[01:11:16] ODELL:

up. So Yeah. It's fucked up, but it's,   tragically   tragic   tragic comedy.   The  

[01:11:27] Unknown:

Tragic comedy.  

[01:11:28] Unknown:

I think John here is saying OG Bitcoiners was forgotten whole whole coin wallets. Yeah. That's exactly what Roman was. You know, he he got in when Bitcoin was 30¢ in 2011.   So he might've put a couple of $100 worth of Bitcoin or something, and that's got some money.   And he was trying to it's really a trend when we look through the Kraken Wallet, the history of the Kraken Wallet, it becomes so apparent that it wasn't the proceeds of Bitcoin Fog coming in.   When you you see a couple of transactions, you have a test transaction, you have, like, like, a large amount coming in, another large amount coming in for Bitcoin Fog, and then you see him just living off of it. He's living off of his Bitcoin, just as he says his whole story. And he tries trading it, and you could trace the trades and you see, you know, he's making a little bit, but he's not really making a life changing amount of money. He's mainly, his money's coming from the appreciation of the Bitcoin that he had accumulated   long before,   right from his paycheck.  

You know, you can see the   story that Roman's telling us, how he was living off the Bitcoin and then wanted to find a job because he realized his Bitcoin was running out. You see that in the history of the Kraken accounts. The government saying it's something totally different and correct.  

[01:12:37] ODELL:

Yeah. So, I mean, just for some context, like, Jack's wallet was a really, really shitty, like, web based wallet.   So, like, you would imagine most,   long time Bitcoiners that were using Bitcoin way back in the day would would use it with smaller amounts. So, I mean, obviously,   the amount now is larger, but at the time, he was probably just using it with, like, you know, spending cash or whatever. It was just like a a small amount that he was kinda just putting there and then you weren't really considering backing up well or whatnot. So it kinda just  

[01:13:08] Unknown:

I think we found, like, 2 and a half big within that one. But   Yeah. It was such a small amount that he had it, and it didn't even really register with him. Like, when we're trying to figure out where all of his funds are, how to fund the case, like, it didn't even register for with him that he had a Jax account. Took a couple months before he even sit in the day. He's like, oh, what about this Jax account?   And it was funny how the how the prosecution misread that transaction.  

[01:13:30] ODELL:

So his main Bitcoin wallets I mean, just, we're going back now. His main Bitcoin wallets, he had with him when he landed in LAX and they seized those wallets? Or  

[01:13:40] Unknown:

Yeah. The Kraken.  

[01:13:41] ODELL:

It's a Kraken account, basically. Oh, so it was I mean, Kraken's super easy to see. So you just, like, press a button. It's like Venmo or whatever in that regard. Mhmm. Mhmm.   Insta seizure.  

[01:13:51] Unknown:

Yeah. Just to add warmth.  

[01:13:53] ODELL:

So on the joke  

[01:13:55] Unknown:

yeah. Go on. Let's say no. I was gonna say it's a little funny how the creator, Kraken, was actually also Michael Groeninger.   Who's the creator of Chainalysis as well.  

[01:14:03] ODELL:

Well, I didn't know that. He was one of the cofounders?  

[01:14:06] Unknown:

Yep.  

[01:14:08] ODELL:

Oh, I've everyone knows Jesse Powell, who I I mean, I like. He's, like, pretty   I mean,   he's pretty principled in general, historically.   But I've never I never knew the creator of Chainalysis as one of his cofounders.   That's that's fucked up.   Yeah. I mean, I've I we talk about in the show many times that a lot of these exchanges,   they're all kind of in bed with each other. I mean, Coinbase has their own in house product now that they sell to   they sell to all the government agents,   including ICE.   Mhmm. And it's   so the   your donation page,  

[01:14:58] Unknown:

you have the fixed address my Twitter. What? You can find that at the top of my Twitter as well.  

[01:15:04] ODELL:

Well, I have it on the stream right now, tour echlin.com.   I mean, it's it's relatively easy to get to. I think, any of the audience that wants to get there can get there.   It's you're using a fixed address. I mean, I know I told you guys off the record that, like,   consider me at your service,   in terms of feedback.   Just to be aware, like, a fixed address is is incredibly   poor   for don donation privacy,   as you said, with clusters and whatnot.   So, I mean, if you guys are interested in improving   that receiving option,   There's an open source project called BTC pay server that essentially every time someone donates,   they donate to a new address. Now that can still get clustered, but it's it's strictly better.  

And we can help you we can help you with that.  

[01:15:56] Unknown:

Most appreciated.  

[01:15:58] ODELL:

Just because it's a very it seems very sensitive a very sensitive case, you know, like, we're, like, talking about how ridiculous all this shit is, and then you just cluster and you're fucking ridiculous.  

[01:16:09] Unknown:

Having to change it, this is something I threw up this this morning. Like, the the fundraising, honestly, is, like, it can be such a pain in the ass for these kinds of cases that, like, I I, you you know, I'd sort of grudgingly do it because it it, like and that's what they're doing by seizing his money. They're they're trying to, again, increase the transaction cost so you can't work on the case   substantively. And I and I joke, but sometimes I feel like, you know, George Lucas trying to make The Empire Strikes Back or,   you know, producer of an independent film. I'm just running around trying to fund the movie.  

And, you know, at the same time, you gotta do this mountain of substantive work. And it's,   again, a reason why most people end up taking pleas.   Because there's not   there's not a lot like, when we got this case to a couple other it had been through a couple federal defenders.   And when we got this case Everyone is throwing him under the bus. No one was looking at the blockchain. Nothing. Yeah. I asked the government. I said, well, can I see the blockchain forensics?   And they said, you're the 1st person to ask us for that.   Okay.  

Right? Like Worked out. Yeah. You know, like,   like, the and what you see, I think, really in the discovery, and this goes back to what you were asking about earlier.   You know, what did they what did they produce and   and not really shit. Right? We really don't have shit. We got a bunch of spreadsheets, speculations,   a couple printouts from Reactor, none of the inputs, really. It's a mess. What it looks like to me is that they just expected this to go to plead   and that they were certain that they had the right guy.   And then they arrest him at the airport, and they catch him with all his, you know, computers and hard drives and everything, and there's this   moment.  

Right? So but they they doubled that. Right? And then they're ready to get the Romanian servers.   Right? And then you see they get the Romanian servers. And, again, it's   but everyone's too far in.   They spent too much money.   They built and sold companies.   They've, you know, launched careers.   They've hyped this stuff   that nobody's willing on their side to admit that they just got the wrong guy.   They fucked up.   And, fortunately, it's something called a fucking too deep now. They don't want it to be they don't want to be exposed. Yeah.   If you're so fucking sure of your work, show me your fucking source code, punk.  

Anyhow.  

[01:18:41] ODELL:

100%. Well, look, guys. I support your fight. It's an important fight.   To to anyone listening who wants to accept Bitcoin donations, I have a episode dedicated to it, so dispatch 57.   The 3 of us will talk off air,   about that.   Before we wrap up, I I like to I like to end with final thoughts,   for our audience.   This has been a great conversation.   Michael, well, let's start with you. Final thoughts.  

[01:19:15] Unknown:

I mean, I'm hoping that we can get him out. You know, it's it's terrible to be talking to someone on the other end of the phone and go to visit him in prison knowing   that he's innocent,   seeing where he's sitting. You know, it's heartbreaking to see that.   You know? And knowing that, knowing all that we know, it just makes it even worse. Knowing the profit motive distorted,   the the concept of justice in this case, which happens way more often than it should, if at all. You know?   Just,   it's a very American prosecution if you ask me.  

[01:19:49] ODELL:

Yeah. That one hit some hard.   Tor, thanks, Michael. Tor, final thoughts.   Did we lose you?   I love it. We lost him on final thoughts.   While we're seeing if Tor joins back, I'll do the final thoughts for him. You can donate to support this,   legal defense fund at toreekland.com.   That's   torekland.com.   Oh, I think you just came back. Technology. You there with us,   Yep. Angie's gone.   He's probably getting hacked because,  

[01:20:43] Unknown:

he's fighting Happens all the time. Fighting an important case.   We're not   the bankers at this firm, but we have got You   could  

[01:20:51] ODELL:

you could tell Tor offline,   that we wrapped it up strong for him.   But that's tour ekeland.com,   torekland.com.   As they said, they will be presenting at a bunch of different meetups and events in Bitcoin land,   including Bitcoin 2023. They will be on the open source stage.   Show them some support.   Give them feedback. Give them help. I'm at your service, Michael.  

[01:21:20] Unknown:

You can share that with me. We appreciate everything you do.   We appreciate everything you do. It's fantastic. We love this podcast.  

[01:21:28] ODELL:

Cheers to that. And, we'll talk about the donations at some point.   Well, anyway,   with that said, this is a great dispatch. I wanna thank our guests again for joining us. I wanna thank the freaks for joining us in the live chat and for bearing with us with the audio difficulties.   It was an important conversation. It's important that we truck through those. I know,   some of you are now listening to this point in the podcast feed and saying,   how did I have to deal with that in my ear?   But, I think it was worth it, and I hope you guys think it's worth it.   I wanna thank everyone who supports the show. I wanna thank everyone who supports this case. It's an important case. I wanna thank everyone who joins us live chat. Thank you, Michael, for joining us. Please pass that along to Tor,   when you talk to him. And, to everyone else, I love you all. Stay humble, stack sets. Thanks, Michael.  



[01:22:19] Unknown:

Will do. Thank you very much. Let's free Roman.  

[01:22:24] ODELL:

Free Roman.