Tuesday, 30 May 2023

Crypto News

How the IRS seized $10B worth of crypto using blockchain analytics

How the IRS seized $10B worth of crypto using blockchain analytics

Blockchain analysis has been key in helping the United States Internal Revenue Service (IRS) seize an estimated $10 billion worth of cryptocurrency since it began investigating a broad body of crimes involving digital assets.

This was a key point raised by IRS Criminal Investigations (IRS-CI) Chief Jim Lee in a wide-ranging, exclusive interview with Cointelegraph in Amsterdam. Lee was among a variety of delegates from public and private institutions sharing knowledge and insights at blockchain analytics firm Chainalysis’ Links conference held in the Netherlands.

Lee, alongwith with a cohort from the IRS-CI, gave an inside look at how the enforcement agency has tackled the use of cryptocurrency and digital assets in a wide variety of financial crimes that fall under its purview.

Hacks of prominent exchanges, Decentralized Finance protocols and cross-chain bridges have seen a spike in stolen funds over the past two years. Source: Chainalysis 2023 Crypto Crime Report

Chief Lee has served as a special agent with the IRS for 28 years and has been at the helm of the unit since 2020. In the years leading up to his tenure, the IRS-CI has found an increasing amount of criminal investigations involving digital assets in varying degrees land on the desks of its agents.

Related: IRS prepares for an increase in crypto cases in the upcoming tax season

The IRS’ relationship with the cryptocurrency space began in earnest in the early 2010s as Bitcoin (BTC) began to proliferate its way into the monetary system as an alternative, decentralized means of holding and transferring value.

As Lee explained, the IRS’ efforts to build infrastructure to combat identity theft around 2011 preempted its effort to begin investigating crimes involving digital money:

“When cryptocurrency came into the picture, we were already thinking about digital crimes and money trails using Web2.”

However, the organization’s ability to understand, investigate and eventually prosecute and seize cryptocurrencies and digital assets became dependent on tools developed by private institutions.

The IRS-CI is one of hundreds of law enforcement and government agencies that make use of a specific suite of blockchain analysis tools that have been developed by Chainalysis. The company was established in 2014 and has become a lynchpin for blockchain-based investigations around the world over the past decade.

Data from Chainalysis’ 2023 Crypto Crime report highlights the increase in the value of money…

Click Here to Read the Full Original Article at Cointelegraph.com News…