On Friday, CipherTrace, a crypto analytics firm, announced that it had filed two patents for technology capable of tracing privacy coin Monero transactions.
The company stated in a Nov. 20 CipherTrace blog that the patents would include forensic tools to explore Monero (XMR) transaction flows to assist in financial investigations, statistical and probabilistic methods for scoring transactions and clustering probable wallet owners, as well as visualisation tools and ways to track XMR stolen or used illegally.
“The Monero tracing capabilities of CipherTrace will enable [Virtual Asset Service Providers] to identify when inbound XMR may have criminal origins, enabling them to risk customer transactions adequately according to any required regulations,” the blog said. “[Our] objective is to make it possible to detect criminal users, thus increasing the security and sustainability of privacy coins such as Monero in the future.”
Acceptance of privacy coins increasing
Although Bitcoin (BTC) is still the preferred exchange medium for many users of the darknet market, there has been increasing acceptance of privacy coins such as XMR. Law enforcement agencies not determine a reliable way to trace Monero. And companies such as CipherTrace have an opportunity. Since early 2019, the company has reportedly been working on a way to trace XMR transactions.
In August, CipherTrace CEO Dave Jevans told that the company had developed the first Monero transaction tracking tool. Such an instrument could potentially support crime investigations and decrease money laundering incidents.
The company has stated that these Monero-tracing instruments have been developed as part of a U.S. project. Homeland Security Department, but the latter is not the only government agency. Looking for a way to identify XMR wallets, dates and times for transactions. The Internal Revenue Service announced in September. It would give anyone who could break Monero a bounty of up to $625,000.
CipherTrace’s tracing tools capabilities confirmed. “In October, one Monero Outreach representative told. That they would be “highly suspicious of any claims that companies can track Monero transactions”. And that any company that did so would be unlikely to “trace any transaction’s wallets or amounts.
At the time of publication, Monero’s price was $123.37, having fallen 3.6 percent in the last 24 hours.