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SUPPOSE WE HAD a complete record of every single financial transaction that took place worldwide over a span of five years. What could we learn by studying the patterns encoded in this complex ledger? The following paper examines this question in the context of Bitcoin, an emerging cryptocurrency that boasts a large and diverse economy, including many legitimate and some notable less-than-legal users. Central to Bitcoin’s design is the notion of a blockchain that records every single transaction between Bitcoin wallets. While the transactions recorded in the blockchain are public, the identity of the users and services behind the Bitcoin wallets are not. In stark contrast with the banking system, where creating a bank account requires identification, any Bitcoin user can create a new wallet, that is, a set of addresses that hold coins, without having to register with any authority. This provides a modicum of …