An update to the Bitcoin Satoshi's Vision (BSV) platform created the opportunity for crime – and someone took it. Child exploitation material was posted on the BSV blockchain, according to The Next Web (TNW).
The door for this crime was opened when the community decided to increase the block size, allowing for much more data to be stored with each transaction. This change meant that images, audio files, and video could be uploaded and stored on the BSV blockchain.
Soon after the update was finalized, images of child exploitation were discovered on Bitcoinfiles.org, a website "hosted by the BSV network." Later investigation revealed that the transaction that resulted in the illicit images being posted was processed through a payment app unique to the BSV network called Money Button.
Because blockchains are designed to be immutable, these images can only be erased by hard forking the BSV blockchain, though there are no signs that the BSV community has plans to take this kind of action. The good news, however, is that "[b]lock explorers have stopped showing the data in those transactions," according to TNW. This means the general public does not have access to the illegal content.
When the news broke, Craig Wright, one of the developers behind the BSV platform, threatened TNW with legal action. In a February 5 Twitter post, Wright went after crypto trading platform eToro, which supported TNW during the launch of its Hard Fork sub-brand, demanding a retraction and an apology, and even threatened to involve the Financial Services Authority (FSA). Wright also claimed that posting of illicit material is just as much an issue on BTC and ETH platforms. In response, eToro was quick to point out that it has no authority over the content published on the TNW site.
Shortly after Wright's post, an editor at Hard Fork tweeted back and asked him to clarify his issue with the article, saying that the author was simply pointing out facts. Wright fired back that the author was not simply pointing out facts but was responsible for "misleading markets" by not including the disclaimer that illicit material can be stored on any digital platform. In this tweet, Wright threatened to expose these "lies" and make an example of TNW.
When asked to point out these specific lies, Wright's indignation and confidence seemed to wither a bit. He said he would point out these lies to the FSA, and all that was required to shut down "the scum promoters spreading lies" would be to demonstrate that this could have happened on any platform.
While Wright appeared more concerned with BSV's reputation than in dealing with the issue of child exploitation, Jimmy Nguyen, founder of crypto-cash company nChain, which oversees the BSV currency (and employs Wright as chief scientist), took a different approach.
Nguyen agreed that it is possible for illegal material to be uploaded to any digital platform, but he did not focus on defending BSV against slander. Instead, Nguyen emphasized to reporters from BBC News that the company has a zero-tolerance policy for illegal activity on the BSV platform. Nguyen said:
"The Bitcoin SV blockchain is not a place for criminal activity – and if you use it for illegal purposes, you will leave a digitally signed evidence trail that cannot be erased. We stand ready to work with global law enforcement authorities to stamp out this and any other illegal misuse of Bitcoin."
Is the solution to limit the amount of data accepted with each transaction? That's one line of argument. We could argue that allowing more data was an invitation to post elicit materials, and that in order to keep this from happening, we should limit this progress.
Nguyen spoke to this issue:
"The answer does not lie in limiting the data capacity of the platform. Instead, responsible service providers operating on the BSV blockchain will take measures to prevent writing to or reading from the blockchain any content that is illegal."
According to the BBC, Bitcoinfiles.org has attempted to fix this problem by closing its blockchain browsing service, implementing a filter to detect potential posting of such material, and giving tracking information of the person responsible to the proper authorities.