Know which exchange or wallet is behind a BTC address

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How can exchanges like Binance do this? Does it mean that when I generate a new BTC address on Binance / Wasabi / Ledger wallets, this address is not completely random but belongs to a tagged pool of addresses pre-attributed to Binance/Ledger/Wasabi etc?

If yes, this is scary! If not, how do they know this information mentioned below?

Source : "Yesterday, July 16, at 8:39 PM PST, there was a deposit of 2.89 Bitcoin (roughly 22.5% of the scammed funds) into Wasabi wallet", ciphertrace.com

Feb 28, 2022 in Blockchain by Aditya
• 7,680 points
5,564 views

1 answer to this question.

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To answer your question, due to each service such as Wasabi and Binance, the tracking of these moments occur by using the techniques which ensure services to allow “fingerprint” a transaction which belongs to such a service. For your understanding, the majority of the transfers of Wasabi included a coin join implementation which gave their transactions away. During the creation of a personal waller by using Ledger, for example, random addresses are allotted and hence there is no possibility for other servers to deduce the identity behind the address unless it comes directly from another address which is known. While this would not give investigators and/or snoopers definitive proof that you used the gambling site and Binance in our example, it could aid them in their investigation. Learn more about Blockchain and its concepts from the Blockchain developer course.

answered Feb 28, 2022 by Soham
• 9,700 points

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