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Is there an automated way to discover the source of funds that were sent to a specific address?

Theory: The EOS team releases 2m EOS tokens every 23 hours. See https://eos.io/instructions for more details. About 20k ETH gets spend on those tokens every day. Nothing stops the team from buying their own tokens again with the same ETH they had received the previous day to pump the price, create an artificial market cap and to create the illusion that the tokens were distributed while they actually still have a very profitable monopoly over the network given it is a DPoS system.

This is probably not true and I am not implying anything or trying to spread any FUD as the team has a good reputation, but as a technical exercise, I would like to know how one will investigate such an accusation given that all transaction information should be publically available.

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The EOS team has no incentive on recycling their funds because it would be breaking the constitutional rules they are proposing: https://forums.eosgo.io/discussion/651/article-vi-v0-3-0-draft-eos-io-constitution-10-ownership-cap

Block.one owns 10% of the stake. Buying additional EOS would put them in the crossfire for an arbitration case.

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Even if some sort of automated service existed, it's impossible to trace Ether transactions properly, because every Ether 'looks the same', although it is not technically fungible because you could still block a certain account from spending its funds (same as fiat). Why tracing is impossible: If you had 5 ether, you could pay them into a massive exchange account with lots of other people's funds and then withdraw them into a different address. No one can detect whether that's you or someone else withdrawing their ether that they have previously paid in. This of course works for any account that received funds from two or more different addresses. You could of course create a token that's non-fungible and traceable like crypto-kitties, but Ether isn't.

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  • Agree, but assuming the theory is correct, you should at least see a large amount of the same funds from the "big exchange" returning to the original "EOS token sale". This could be coincidence, like you said, that someone on the exchange brought the ETH who also want to partake in the EOS token sale, but if the pattern repeats every day it would be suspicious.
    – Jasper Citi
    Commented Feb 22, 2018 at 15:50
  • Yeah, I guess if someone put literally no effort into hiding these activities you could see the patterns fairly quickly! You could split the amount into many smaller chunks of course and withdraw into different accounts etc.
    – Theo Port
    Commented Feb 22, 2018 at 16:08
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You can sign up on Coinfirm to do chain analysis and get hop tracing and various reports on Ethereum addresses:

http://coinfirm.io/

You can pay for the service using AMLT token.

Disclaimer: I hold AMLT token.

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You can obtain such information with the help of blockchain analysis solutions. Resources used for it range from blockchain explorers to costly B2B tools. There are also hybrid solutions like Cryptohound. The latter works well on tracing money flows from various addresses (BTC/ETH up to date), providing token and trading analytics. It has some nice widgets for blockchain analytics:

  1. Graph Widget for the viewing, expanding and exploring of the transactions and relationships of any searched addresses
  2. Balance Widget summarizes the list and total value of all tokens held over some time
  3. Statement Widget supports the Graph Widget by providing more details related to all incoming and outgoing transactions, with historical balances viewed in the currency of your choice

... and many others. Check available solutions; maybe it would be helpful for your future researches.

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