Bitcoin analysis tools are slowly but surely becoming the new norm. With all of the financial records published publicly on the blockchain, distinguishing patterns is not overly difficult. However, the sheer volume of transactions makes it hard to come up with real-time solutions. A new research lab is working on a Bitcoin analytics tool for the Department of Homeland Security.
Homeland Security Embraces Bitcoin Analytics
It is not the first time the name Department of Homeland Security comes to mind when talking about Bitcoin. The law enforcement agency has said they were working on Bitcoin analytics several months ago, albeit they did not reveal too many specifics. It appears as if they had a tool at their disposal, but decided to have a better one developed to identify suspicious transactions on the blockchain.
Said new tool is being prepared by a federally funded research lab. News about this development was made public in a recent newsletter. In this newsletter, slightly more details regarding past Bitcoin efforts by the DHS are highlighted as well. It is, in fact, Homeland Security’s Science and Technology Directorate which is funding this research lab.
While things appear to be in the very early stages right now, this is an intriguing development. Money laundering is a top priority for law enforcement agencies, and the blockchain makes it much easier to track transactions in real-time. In a way, the development of this tool is a nod of approval towards Bitcoin and its technology. At the same time, cryptocurrency is – often falsely – referred to as a great way to avoid taxation and launder money.
The new Homeland Security Bitcoin analytics tool is currently being developed according to a specific set of requirements. Additionally, the user interface to make this tool accessible to law enforcement agents still needs to be developed. Don’t be mistaken in thinking this one tool will solve all crimes on its own, though. Analysts have mentioned this new Bitcoin analytics tool should only be used as part of “broader efforts involving multiple angles”.
While some people may see this as bad news, there are a lot of positives to this story as well. If Homeland Security would be able to weed out the illicit elements of Bitcoin commerce, cryptocurrency’s perception by the public will change as well. In turn, this can lead to increased global adoption, which is what most of us want anyway.
Header image courtesy of Shutterstock