The Pentagon researches possible tools to track Bitcoin transactions in an effort to detect criminal activity
Pentagon experts are considering hiring a cryptographic analysis service to efficiently detect Bitcoin transactions for fraudulent and criminal purposes. This follows the recent Twitter hacking, which was a scam designed to get Bitcoin from people.
In a statement released on July 10, the Department of Defense issued a contract opportunity for an “Investigative Web Application with cryptocurrency”
According to the report, the Department of Defense is looking for a “web-based application capable of assisting law enforcement to identify and prevent actors who use cryptocurrencies for illicit activities, such as fraud, extortion and money laundering. The application should allow users to conduct an in-depth investigation into the origin of cryptocurrency transactions and provide analysis of various Bitcoin currencies in pairs with other major cryptocurrencies. ”
Many blockchain companies have shown signs of interest. Chainalysis, Elliptic and Coinbase have a history of working with government agencies. In a somewhat controversial move, Coinbase licensed its $ 124,950 blockchain tracking software to the IRS earlier this week.
Coinbase declared who are very cooperative with the authorities and law enforcement:
“We will always look for ways to work with law enforcement agencies and bodies to combat illegal activities,” said a company spokesman.
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A broad agenda
In early March a bill called “Eliminating Abusive and Rampant Neglect of Interactive Technologies Act of 2020 was introduced in the Senate”. This would allow law enforcement access to encrypted communication software to combat illegal activities.
In June, the “Lawful Access to Encrypted Data Act” or LAED was introduced. It is a de facto ban on any company that provides cryptographic products or services that do not offer a backdoor for government access.
Over the past few months it appears that the U.S. government is taking a stand against cryptocurrencies and is slowly evading them, so the Defense Department contract would improve this trend.
If LAED or any anti-crypto law is passed, companies should create backdoors (which may not have existed before) in your products or software to assist law enforcement.
This poses a very public threat to privacy. With backdoors providing immediate access, individuals with malicious intent can abuse the vulnerability and wreak havoc on a company and its user base.
As our personal lives are rapidly digitized each day, it is extremely dangerous to create a point of attack for hackers.