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Blockchain analytics firm CipherTrace has filed two patent applications that it claims will help authorities monitor transactions made with the monero (XMR) cryptocurrency.
According to an announcement on Friday, the company recently filed a paper titled “Probabilistic Methods and Techniques for Tracking Monero” as a follow-up to the previous patent application “Systems and Methods for Investigating Monero” – both stemming from the company’s work. with the U.S. Department of Homeland Security, launched in 2019.
The archives provide technical concepts for forensic tools that enable exploration of XMR transaction flows in financial investigations.
While monero, the 16th largest cryptocurrency on CoinMarketCap, aims to offer users more anonymous and private transactions, is supported by 45% of darknet markets and favored by criminals for the same properties, the company said.
According to the company, the patents will lay the “foundation for future implementation” of entity transaction clustering. In addition, they provide identification of the wallet and attribution of the exchange which would give law enforcement “even more tools” to investigate criminal activity using XMR.
“The built-in obfuscation techniques are what appeal to both privacy advocates and criminals,” according to the announcement.
CipherTrace said its documents also provide concepts for visual tools and ways to track down stolen XMR, methodologies for capturing transaction information made through third-party nodes, and probabilistic approaches to risk-based monero laundering controls.
With some regulators viewing privacy coins such as monero, dash, and zcash as a money laundering risk, some exchanges have decided to remove them, including Colorado-based cryptocurrency exchange Shapeshift earlier this month.
