The United States knew how to track Bitcoin transactions since 2015
The Daily Beast has managed to successfully use the Freedom of Information Act, acquiring and publishing a document that describes a special tool that tracks cryptocurrency transactions, “to help us trace the movement of money through the bitcoin economy”, as it is said in the contract. “Us” being the IRS, or the Internal Revenue Service, a governmental body in the United States.
Turns out that the Internal Revenue Service collaborated with Chainalysis, a startup that focuses on blockchain and “fighting dirty bitcoins”, as Reuters once cleverly described. This company has cooperated with law enforcement before. The software described in the document is able to follow a certain transaction all the way from the origin to cash-out point, the last entity from which the criminal converts altcoins into cash.
The software can follow bitcoin as it moves from one wallet to another, and eventually to an exchange where the bitcoin user will likely cash out into dollars or another currency. This is the point law enforcement could issue a subpoena to the exchange and figure out who is really behind the bitcoin.
If these rumors are true, then financial supervision agencies of the United States have learned to track tax evasion and illicit enrichment back in 2015. If other articles containing speculations that the Russian government is so interested in cryptocurrencies because it wants to hide its wealth obtained through corruption – well, looks like they lost a safe haven at least for a time being.
The Daily Beast also asked Alan Woodward, a computer science professor at the University of Surrey, what he thinks on the matter. Cybercriminal activities and cryptography are in his field of research. He told that those who are seeking to evade from taxes will find new ways and new cryptocurrencies which are not susceptible to the current tracking methods.
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