Cryptocurrency

IRS will pay $ 625,000 to develop solutions for tracking anonymous cryptocurrencies

The IRS will pay $ 625,000 to developers who manage to create tools to track Monero cryptocurrency and other anonymous digital assets.

The agency announced that it is ready to cooperate with several contractors who can provide innovative solutions for tracking transactions with anonymous cryptocurrencies. According to the IRS proposal, organizations or individuals must provide a working prototype that can be used to “break the veil of anonymity” of Monero. 

These can be special tools, source codes, algorithms, or software. The purpose of the developments is to use them to obtain information about the user of the Monero wallet, the amount of the transaction, as well as the date and exact time of the transaction. In addition, such tools should provide statistics and predictions at what time transactions can be executed from certain addresses.

The IRS is accepting applications for the program until September 16th. The remuneration will be paid in two stages. Developers will receive an initial payment of $ 500,000 for the creation of the tool and the proof of concept within eight months after the approval of the developments. After successful testing of the tools and their approval by the government, the developers will receive another $ 125,000.

The department emphasized that cryptocurrencies like XMR are focused on the complete privacy of users: the amount of the transaction is hidden, as well as the addresses of the sender and recipient. This is often used by hackers and criminals to “cover the tracks” of their activities. The agency referred to a situation in which hackers Sodinokibi stole celebrity data from the law firm Grubman Shire Meiselas & Sacks in the spring and demanded $ 42 million in XMR, threatening to publish incriminating evidence on US President Donald Trump.

Recall that in July, a client of the Coinbase cryptocurrency exchange filed a lawsuit against the IRS for seizing his personal data, accusing the department of violating user rights. As I stated Jonathan Levine (Jonathan Levin), co-founder of Chainalysis, tracking suspicious transactions kriptoaktivami, even complete transparency of transactions will not be able to prevent illegal trade.

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