Italian investigators have uncovered a years-long scheme of tax fraud involving Bitcoin Ordinals and BRC-20 tokens, among the earliest significant law enforcement cases involving these new types of Bitcoin assets. It appears the alleged criminal profited more than €1 million (about $1.1 million) from their illegal activities, in addition to fraudulently applying for and receiving public support for which they were ineligible. The case, revealed through blockchain analysis by Italy’s Guardia di Finanza, shows the power of these technologies to solve the technical challenges posed by Ordinals. Italian Guardia di Finanza targets Ordinals-enabled evasion The investigation was spearheaded by the Unit of Economic and Financial Police of Foggia, in collaboration with the Special Unit for Privacy Protection and Technological Fraud in Rome. A hardware wallet called “Ledger” was confiscated during one of the house searches, marking the start of the investigation. Even though the wallet created new addresses for every transaction—a common privacy technique—an ownership analysis revealed that all those separate addresses were owned by a single owner. The core of the scheme lay in a four-step process that used the Ordinals protocol, launched in 2023. The first step would be to move satoshis from the accused person’s main wallet cluster to an inscription service outside the system and then to write any kind of data into the witness field of Bitcoin transactions and create non-fungible Ordinals. Additionally, the subject conducted minting and exchange of BRC-20 tokens—these represent an innovative token standard for fungible tokens on the Bitcoin network, based entirely on inscriptions without smart contracts. After inscribing these inscriptions, they could be exchanged on Ordinals-specific platforms at a considerable markup. Funds from Bitcoin sales would then be deposited into the main wallet pool and used immediately to fund additional inscriptions. The closed system enabled the subject to generate substantial undeclared profits while still receiving public funding. Chainalysis traceability challenges the myths of crypto anonymity For their investigation, the Guardia di Finanza opted for Chainalysis Reactor, which enabled them to create a visualization and to unravel the complex transaction network. The tool helped convert what was originally a seemingly jumbled sequence of haphazard Bitcoin transactions into a recognizable “inscription monetization cycle.” Based on their analysis, they were able to quantify the extent of the evasion at more than €1 million. This is what stood out from the analysis – despite the introduction of novel data storage methods such as Ordinals and BRC-20 tokens, the existing Bitcoin UTXO structure still enables complete on-chain traceability of all activities. Right from the process of paying for the inscription to exiting the network, everything was traceable. Bitcoin markets experience volatility ahead of the weekend run Bitcoin (BTC) still dominates the crypto industry, trading at about $77,158 per token and with a market cap of $1.54 trillion. This is about 58-60% of the total crypto market which stands at $2.57-$2.65 trillion. Over the past 24 hours, BTC has shown little volatility, ranging from $76,655 to a high of $78,100, with gains of 0.69%. Good liquidity is evident with daily spot trading volumes over $26.7 billion. Estimates for Q4 2026 have been $74,000–$115,000 based on liquidity and risk appetite, according to Cryptopolitan. Bitcoin’s dominance has been stable, showing little capital is moving to altcoins. Infrastructure will remain intact in the future with institutional instruments and regulatory progress. The Bitcoin Ordinals market is currently quite sluggish (May 21, 2026), with not many transactions happening recently, but with the aggregated market cap remaining stable in the mid-nine-figure range. Aggregated market cap for all tracked Bitcoin-based NFTs is around $115M-$117M USD. Volume/trade in the last 24 hours is extremely low — data from major tracking websites shows 0 or almost 0 within the last 24 hours, suggesting that liquidity is very poor compared to high times such as 2023-2024. If you're reading this, you’re already ahead. Stay there with our newsletter .
