Cryptocurrency is transforming the way we electronically transfer money; however, it is also transforming the way criminals use this technology. One popular misconception surrounding Bitcoin and other digital assets is that they can be used anonymously like “cash.” Ironically, they cannot be used anonymously, and there is plenty of evidence to support this within the blockchain.
Additionally, many criminals who demand payment in cryptocurrency tend to leave behind a significant amount of evidence regarding their activities on the blockchain. Therefore, there are many different ways to track evidence through a blockchain transaction history. This has been made very apparent in a recent high-profile kidnapping case that was prosecuted in the US, showing the growing need for law enforcement and forensic investigations to implement these types of blockchain forensic services.
Some companies, such as Lionsgate Network, have enormous amounts of experience in utilizing advanced cryptocurrency transaction analysis to assist with crypto recovery and structured crypto recovery service efforts on behalf of past scam victims. In those cases, even though cryptocurrency is not being used for payment, it is still being used to establish enough evidence to link a suspect to criminal activity through the paper trail left behind on the blockchain.
@Savanahguthrie, Instagram
The Case That Put Bitcoin Ransom in the Spotlight
Reports surfaced in February of 2026 regarding 84-year-old Nancy Guthrie from Tucson, Arizona, who was the mother of a well-known TV news anchor; thus, this case received daily national media coverage. However, what has kept this case in the news is that the kidnappers demanded an extensive ransom for the return of Nancy, and the ransom was demanded in the form of millions of dollars in Bitcoin.
According to an article in The Daily Mail, the ransom note supplied details for completing the ransom payment and provided a unique crypto-wallet location for where the ransom payment was to be deposited. Law enforcement immediately viewed this as a key lead in the investigation of the kidnapping, and while the investigation is ongoing, Nancy’s case has been an example of the transparency capabilities associated with blockchain technology, which is often used to perpetrate digital crime; in this case, blockchain turned the tables on the digital criminals who perpetrated this crime against Nancy.
Why Criminals Misunderstand Cryptocurrency
A great number of offenders mistakenly believe their cryptocurrencies afford them untraceable, anonymous transactions. However, as explained to the Daily Mail by Bezalel Eithan Raviv, founder of Lionsgate Network, the blockchain has an open architecture, making it arguably one of the world’s most transparent financial networks.
“There is an audit trail for every transaction that occurs on a cryptocurrency; once a transaction has taken place, it cannot be changed or deleted. In addition, all cryptocurrency transactions must enter or exit through regulated exchanges; therefore, any transfers of funds will ultimately be exposed through a regulated exchange.”
Therefore, the immutable transparency, which was once viewed as an obstacle by early adopters, will now serve as a forensics tool for investigators investigating crime involving cryptocurrencies.
How Blockchain Transparency Works Against Criminals
Blockchain technology can be an extremely useful tool in criminal investigations, primarily for three reasons:
- A blockchain is an open yet pseudonymous digital ledger system so that all transactions carried out using Bitcoin can be viewed on a public ledger, although there are no names associated with those transactions. However, by analyzing the history and the relationships of wallets (addresses) over time, it is often possible to determine the identity of the owner of a given wallet.
- A blockchain can provide an immutable digital ledger of all transactions. Once a transaction is recorded on the blockchain, it is impossible to change or alter it, which means that the digital history of that transaction exists forever.
- Criminals always eventually convert digital assets into fiat currency, either through KYC exchanges or payment processors. Eventually, these exchanges/processors must report all KYC-compliant transactions to governments.
As Raviv said, “At some point, money will be easily found and identified that is when you can catch criminals.”
The Speed Factor: Why Immediate Analysis Matters
Timely action can change the outcome for ransom and extortion situations. Quick tracing of blockchain transactions can result in compliance alerts being generated by blockchain tracing, assist with the coordination of law enforcement, and help in freezing assets before they are transferred out of an account through laundering transactions.
Expert forensic analysts will monitor:
- Re-use of wallets and identifiable patterns of transactions;
- Transactions across blockchains and token-to-token swaps;
- Timing of suspicious flows of money and splitting funds between different accounts.
Even after money is converted between different blockchains, well-trained forensic analysts can re-establish the path taken by money to and from many different wallets that appear to be unrelated.
Why Crypto Ransom Is Rising And Riskier Than Ever
Lionsgate Network’s hyped investigation finds evidence that criminals are using cryptocurrency to solicit their victims. The reasons for this growth are speed, easy access, and, erroneously, an expectation of anonymity.
For criminals, the unfortunate reality is that their expectation of anonymity is inaccurate.
“Criminals see cryptocurrency as a haven, but cryptocurrency is a chain of evidence that can be followed to capture them,” explains Raviv.
Every single new ransomware case or extortion case adds to our forensic system of intelligence to quickly identify and show money laundering and other behavioral patterns in laundering methods. Therefore, the performance of a successful crypto recovery process and a successful structured crypto recovery service are continuously enhanced because of the evidence arising from each transaction associated with that criminal.
Bezalel Eithan Raviv, CEO, Lionsgate Network
Inside Blockchain Forensics at Lionsgate Network
The processing of cyber ransom and extortion cases necessitates the application of advanced tracking techniques beyond the norm of traditional tracking methodologies. Lionsgate Network utilizes a combination of sophisticated analytical technologies and collaboration with law enforcement to create means by which to identify, trace, and disrupt digital crime networks.
Examples of how we achieve this are as follows:
- Reconstruction of transaction paths: Recording each step of the movement of funds.
- Grouping of wallets: Grouping multiple wallets that are controlled or owned by the same entity.
- Mapping of exchanges: Identifying regulated exchanges to link to real-world identities of wallet holders.
- Profiling of behavior: Identifying behaviors based on similarities in how incidents occur or the method in which the act was carried out.
The investigative rigor used in our efforts will allow for the conversion of unrefined data from the blockchain into usable intelligence by assisting with criminal investigations and protecting our clients.
Why Victims Must Act Quickly
You need to move quickly in reporting a crypto ransom threat, whether you or someone else is the victim. Reporting in a timely manner will allow forensic experts the ability to evaluate movements prior to the funds being obscured by layering, mixing, or transferring between chains.
Delays could result in:
- Laundering of funds that becomes more difficult to track
- Loss of critical timestamps and continuities for tracing
- Missed opportunities to freeze at exchanges
At Lionsgate Network, our staff assists in securing early record data, interfacing with exchanges, and supporting law enforcement collaboration. Time lost today may mean missed opportunities tomorrow!
Crypto Isn’t the Problem Misuse Is
Cryptocurrencies, such as Bitcoin, are not illegal; they are a form of technology. The problem lies in how certain individuals utilize them inappropriately. When used appropriately, blockchain’s transparency provides a means to assist law enforcement in locating those who have committed crimes.
Raviv says it well: “The blockchain shows transparency, which is the advantage for us when we pursue criminal misuse.”
Sheriff Nanos, at a press conference in Tucson, Arizona © Reuters
Why Choose Lionsgate Network for Blockchain Forensics
At Lionsgate Network, we use a combination of technical expertise, investigation proficiency, and experience with real-life law enforcement to provide service to both institutional clients and individuals.
We provide the following services:
- Linking complicated cross-chain transportation
- Preserving critical transaction records
- Providing assistance in enforcement and recovery
- Combining blockchain intelligence with human analysis
The intersection of technology, crime & law requires specialists who have an understanding of the technology and of the techniques used to commit the crimes. This is where Lionsgate Network offers leadership.
Expert Q&A
1. Are Bitcoin ransom payments really traceable?
Bitcoin transactions can be tracked through blockchain forensics because they are all recorded in a public ledger system. A transaction can also be traced back to a particular wallet owner based on traceable activity despite the fact that wallets are pseudonymous (i.e., they do not contain identifying information about their owners).
2. Can mixing or using privacy coins hide funds?
When mixing services with privacy coins, tracing can be harder than tracing only with one service; however, it is still possible to do so. Analysts with the necessary experience utilize pattern matching and cross-chain analysis to trace obfuscated transactions.
3. How do exchanges help investigations?
KYC and AML laws require exchanges to establish identity for every customer they do business with. Luckily, because they keep records of customers’ wallet info, investigators can link a customer’s criminal activity with the user’s wallets to aid in identifying suspects and recovering stolen goods.
4. What should victims do first in a crypto ransom case?
Instead of immediately sending money to the parties involved, it may be better to arrange for a discussion between those parties about the situation. You can do this by contacting experts in forensic blockchain analysis, like Lionsgate Network, for help and reporting the incident to local law enforcement as soon as possible.
5. Why is blockchain transparency an advantage for victims?
The permanent record of blockchain data, which cannot be modified or deleted, gives investigators an unchangeable path that allows them to track evidence of criminal activities.
Businesses have access to Lionsgate Network’s sophisticated blockchain forensic tools for tracking their cryptocurrencies, recovering stolen crypto assets, and providing operational support. They use advanced analysis tools to create transparent results in otherwise disorganized situations.
