Australian police have successfully cracked a coded cryptocurrency wallet backup, recovering an estimated 9 million Australian dollars, equivalent to $5.9 million USD.
Australian Federal Police (AFP) Commissioner Krissy Barrett described the achievement as "miraculous work" during a recent speech, attributing the success to a data scientist within the agency who has earned the nickname "crypto safe cracker."
The breakthrough occurred during an investigation into an individual alleged to be a "well-connected alleged criminal" who had amassed cryptocurrency by selling "a tech-type product to alleged criminals." Law enforcement discovered password-protected notes on the suspect's mobile phone, along with an image containing what appeared to be random numbers and words.
Barrett explained that the numbers were organized into six groups with numerous combinations. The AFP's digital forensics team determined these sequences could be linked to a crypto wallet. The suspect reportedly refused to provide the keys to his crypto wallet, a refusal that carries a potential 10-year penalty in Australia.
"We knew if we couldn’t open the crypto wallet, and if the alleged offender was sentenced, upon release he would leave prison a multi-millionaire – all from the profits of organised crime," Barrett stated. "For our members, that was not an acceptable outcome."
The Code Cracking Process
A data scientist employed by the AFP realized that the alleged criminal had intentionally obscured the access to his cryptocurrency. The data scientist identified that the numbers presented were structured in a way that suggested an attempt to create a "crypto booby prize." To decode the 24-word seed phrase, the first number from each sequence needed to be removed. This manipulation successfully unlocked the wallet, revealing assets valued at $5.9 million.
The data scientist noted that "some of the number strings felt wrong and they looked like they were not computer-generated." He further elaborated that these specific strings "looked like a human had modified the sequence by adding numbers to the front of some sequences."
This successful recovery is not the first for the AFP's digital forensics team. In a separate case, the same data scientist utilized a different decoding technique to recover over $3 million in digital assets.
In both instances, the seized cryptocurrency was handled by the AFP-led Criminal Assets Confiscation Taskforce. Should a court order the confiscation of these funds, the money will be deposited into a Commonwealth account and subsequently redistributed by Home Affairs Minister Tony Burke to support crime prevention initiatives.