IRS puts $ 625,000 bounty on privacy coins

Many criminals take advantage of Monero’s (XMR) privacy. However, the US tax authorities have now come up with something.

The anonymity of Monerocould soon be a thing of the past – at least when it comes to US tax collectors

Because the US tax agency IRS(United States Internal Revenue Services) has announced a quasi-bounty of up to US $ 625,000. This is intended to reward those who uncover the anonymity of privacy coins such as Monero (XMR) with appropriate tools. Transactions via the Bitcoin Lightning Network (BTC) should also be traced in this way. The US is not the only country with such an initiative. Russian President Putin recently mobilized against the anonymity of Bitcoin Up platform and Dash .

The official tender was released last week. Accordingly, the IRS will accept submissions in the form of working prototypes by September 16. If accepted, applicants will receive an initial payment of $ 500,000. But that’s not all: the grant will enable applicants to develop their prototype into a working concept over the next eight months. Once the pilot test is completed and approved by the government, an additional grant of $ 125,000 is in prospect.

Criminals often exploit privacy at Monero

One can only speculate as to whether the main goal of this bounty campaign is actually the fight against crime or whether there are other interests behind it. The invitation to tender definitely contains further requirements for the solutions submitted. The products of the Criminal Investigation Department (CI) of the IRS should enable full control with the possibility of further development or modification. With this, the organization clearly wants to prevent it from being dependent on external providers in its fight against crime.

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Why is Monero of all things so important to the authorities? This is because there are, in fact, many criminal organizations that use this cryptocurrency. Privacy and anonymity are much better protected with Monero than with Bitcoin, for example. The IRS noticed that Monero (XMR) is being used for ransom demands and transactions of the ransomware „Sodinokibi“ due to the special „data protection clause“. With CipherTracethere should already be a way to trace Monero transactions. But what is still missing here is an absolutely watertight confirmation of these capabilities. The company announced that the tool, which took more than a year to develop, will be used by the US Department of Homeland Security, among others.