A study from Germany discovering 'child pornography links' in blockchain data has been reported as the death knock for Bitcoin, proving its status as illegal in many countries. This has sparked irritation from experts who point out this was reported in 2013 and does not convey the way the data is present or how it can be extracted.
It is famously known that a Times headline is written into Bitcoin's genesis block as a string of code that can be converted into the following text: "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks." Yet, just because a string of text can be translated into an indecent image does not mean possession of that text is illegal. For example, if you take an image, convert it into binary code, and then decimal, you will probably be able to find it somewhere within the number Pi, yet this does not mean Pi 'contains' your image or any theoretical image that could be translated from it.
On the other hand, the US Department of Justice definition of child pornography includes: "electronically stored data that can be converted into a visual image of child pornography." If this were applied to blockchain nodes, it could affect the 2700 nodes in the US, all of which possess a copy of Bitcoin's blockchain, including this data.
The reason the 'new development' spread online is due to Bitcoin's blockchain being both publicly accessible and unalterable, although there are suggestions nodes are capable of pruning this data. This has highlighted the ability to add personal messages into the blockchain which can be done manually or by using companies such as EternityWall. Recent posts include birthday messages, predictions of the future and cryptic messages like: "My physical experience is not (yet) synced with my mental experience."
Defendants of blockchain's legitimacy argue there needs to be a distinction between possessing the data and converting it to use the links, which is illegal.