CipherTrace has filed two patent applications for its Monero transaction tracking system. The firm claims the solution is designed to bring more transparency to Monero and make it harder for bad actors to use the privacy-centric altcoin for their illicit deals, according to a blog post on November 20, 2020.
CipherTrace Cracks Monero’s Anonymity Code
While bitcoin (BTC) remains the number one choice of crypto for rogue actors and traders on darknet marketplaces despite the fact that Bitcoin transactions are quite traceable, privacy-centric altcoin, Monero is fast gaining popularity on the dark web, as 45 percent of merchants now accept XMR.
In a bid to bring more transparency to Monero (XMR) and make it harder for criminals to use the world’s 15th-largest digital currency for illegal transactions, CipherTrace, leading crypto analytics and blockchain security firm established in 2015, has filed patent applications for its Monero transaction tracking systems.
As stated in its blog post, Ciphertrace has been working on the Monero traceability project in collaboration with the U.S. Department of Homeland Security since early 2019 and has now successfully developed solutions that will enable crypto exchanges and other virtual asset service providers (VASPs) to easily spot XMR transactions with criminal origins.
CipherTrace’s latest Monero tracing patent application is dubbed “Techniques and Probabilistic Methods for Tracing Monero and the firm claims it covers “forensic tools to explore Monero transaction flows to assist in financial investigations, development of original tracing methods based on simulation and Bayesian approaches, XMR transaction visualization tools and more.”
The firm wrote:
“This project has laid the groundwork for future implementation of entity transaction clustering, wallet identification, exchange attribution, and other functionality that will provide law enforcement with even more tools for investigating Monero transactions and addresses related to criminal activity.”
While CipherTrace’s claims remain unconfirmed, the effectiveness of these tools for tracking Monero transactions will no doubt gladden the hearts of governments and financial regulators who have been making active plans to crush privacy-protecting digital currencies.
Last September, reports emerged that the United States Internal Revenue Service (IRS) was offering a $625k bounty to any entity that could develop highly functional solutions for tracking privacy coins transactions.
In October 2020, the IRS chose Chainalysis and Integra FEC for the huge task and both firms are expected to submit a working Monero transaction tracking solution within the next eight months.
At press time, the price of Monero (XMR) is up by 2.48 percent in the last 24-hours, trading at $127.68, with a market cap of $2.27 billion, as seen on CoinMarketCap.