UK tax authority to oppose crypto crimes with blockchain tools

While the cryptocurrency sector still has its downsides which have made it a dangerous trend in the eyes of many, blockchain technology continues to be treated with more and more appreciation. The most recent example of this comes from the UK tax agency, HM Revenue and Customs (HMRC). The agency is considering what role blockchain analytics technology might play in identifying crypto-related crimes, and even planning to make an investment into this sector. Recent reports claim that the tax authority already published an open contract in its search for an adequate tool. The tool in question would need to be useful for identifying unlawful cryptocurrency transactions. However, HMRC also wants it to be able to pick up on other criminal activities, such as money laundering or tax evasion.

The agency offers to support licensing of the tool

As mentioned, the agency is also willing to provide a 100,000 GBP investment ($130,000) in order to support the licensing of one such tool. For now, the firm is collecting proposals from interested parties and will continue to do so for the following 10 days, until January 31st. It will then make its choice, and it expects to start the contract by February 17th, with the initial period of one year. The tax agency’s publication further states that many of the crypto transactions are recorded publicly, although those who made them remain anonymous. While all cryptocurrencies can be used for making unlawful transactions and committing other crimes, the agency is focusing on the seven largest coins out there. Those include Bitcoin, Ethereum, XRP, Bitcoin Cash, Litecoin, Tether, and Ethereum Classic. Of course, the agency would also prefer for the tool to be capable of tracking privacy coins, as well, primarily Monero, Dash, and Zcash. Due to the growing number of criminal activities involving cryptocurrencies, crypto analysis is becoming highly sought-after, especially when it comes to government agencies. However, private firms are doing their fair share of developing and acquiring such tools for themselves. This led one of the most popular blockchain analytics, Chainalysis, to partner up with numerous firms and crypto exchanges in order to identify and mitigate illegal transactions.