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Photo: United States Department of Security / Flickr
Although such cryptocurrencies as Zcash and Monero have been developed to provide complete privacy, however, this option may not be available.
Because of the increasing volumes of fraud and money laundering activities by disloyal people using these digital assets based on a distributed privacy-based accounting technology, the US Department of Homeland Security (DHS) is planning to examine the feasibility to track these transactions.
Intentions of DHS
According to the recently published pre-solicitation notice, DHS wants to find out whether it will be possible to track and evaluate the transactions on blockchain that are carried out with the involvement of private currencies.
The document is publicly available and interested parties can comment and send requests to receive information on problems. One of these problems is "Blockchain Applications For National Security Forensic Analytics".
As has been revealed, DHS is planning to achieve its goal by introducing a product that will be developed with the objective of "supporting the implementation of blockchain-based forensic analysis, data analysis and information sharing".
DHS already has analytical tools focused on Bitcoin but their application is rather limited. This is why the company is extremely interested in creating blockchain monitoring frameworks that allow monitoring of Zcash and Monero.
Entering the privacy cryptocurrency area will help DHS expand its capabilities and give it the ability to deal with the threat posed by potentially illegal and illegal hidden transactions.
The need for such a project is explained as follows:
"Every time we can deny terrorists funding is good, and this bill is very important to recognize <abbr class =" glossarizer_replaced "style =" border: none! Important; text-decoration: none! Important; cursor: auto; "title ="
A digital reserve of monetary value whose main use is the purchase and sale of goods, services or properties, such as Ether or bitcoin. Cryptocurrencies are protected by encryption against counterfeiting and are often not issued or controlled by any centralized authority.
"> cryptocurrencies I am here to stay and become more rooted in the fabric of our lives. The disadvantage is the lack of knowledge about cryptocurrencies within DHS. "
Implementation plan
DHS plans to establish valuable partnerships with blockchain startups that are also interested in making the blockchain ecosystem safer and more transparent.
The proposal States:
"This proposal seeks the application of blockchain forensic analysis for new cryptocurrencies, such as Zcash and Monero, and ongoing research in the field also contributes to new implementations and technology techniques that continue to multiply specific types of consent, privacy, security and testing mechanisms ".
The research is divided into 3 phases. The first phase presupposes the creation of a blockchain analysis ecosystem that will be intentionally designed for transactions with private currencies. It will make forensic analysis for internal security possible.
In the second stage, it is planned to prototype and demonstrate the blockchain forensic technologies that will be designed in the previous phase.
And the third step includes a broad application of blockchain forensic analysis for government and commercial purposes. It is expected to help improve law enforcement aspects as well as know-your-customer and anti-money laundering compliance.
DHS also stresses that while blockchain technology is actively integrating into the global economy, the successful implementation of DLT's legal analysis tools will be beneficial to all participants in the economic system.
The pre-solicitation period has already started and will last until 18 December 2018.
