- The DHS Small Business Innovation Research Program is focused on finding out the possibility of conducting forensic analysis on transactions powered by privacy-focused coins
- The DHS has invited blockchain-linked startups interested in the matter to send in their comments until December 18, 2018
- The DHS says it acknowledges the usefulness of blockchain technology, therefore, it’s looking to create a system that hampers the use of DLT for unlawful practices
In a bid to curb the activities of bad actors who use privacy-centric distributed ledger technology (DLT) based digital assets in facilitating their money laundering activities, the United States Department of Homeland Security (DHS) has released a pre-solicitation document aimed at studying the feasibility of tracking such transactions, according to a paper published Nov. 30, 2018.
DHS to Develop a System for Blockchain-based Forensic Analysis
Blockchain technology, which is the firm foundation behind bitcoin and other cryptoassets, is slowly but steadily gaining adoption across a vast array of industries, from finance to supply chain and even health sectors, thanks to its ability to eliminate intermediaries, foster privacy and more.
Sadly though, due to the unregulated nature of the blockchain space, rogue actors have also taken advantage of the anonymity that comes with privacy-centric cryptos such as Zcash, Monero, and others, to enhance their criminal activities.
Now, the United States Department of Homeland Security (DHS) has drafted a proposal titled: “Blockchain Applications for Homeland Security Forensic Analysis,” which is targeted at formulating a blockchain analysis ecosystem that will make it easy for law enforcement agents to carry out forensic analysis of fraudulent blockchain transactions, especially those made with privacy-focused cryptocurrencies.
The DHS plans to collaborate with startups in the blockchain ecosystem and try to develop a highly functional system that will cater to a vast array of blockchains both existing and the ones yet to be created.
“This proposal seeks application of blockchain forensic analytics for newer cryptocurrencies, such as Zcash and Monero. And, ongoing research within the field also contributes to new technological implementations and techniques that continue to multiply the specific types of consensus, privacy, security, and proof mechanisms.”
For the Good of All
Though still nascent, the DHS notes that blockchain technology is fast making its presence felt in the global economy, and the successful creation of a DLT forensic analytic platform will be highly beneficial to the “DHS law enforcement, and security operations across components and private financial institutions can likewise use it in enforcing know-your-customer (KYC) and anti-money laundering (AML) compliance.”
The pre-solicitation period is live now and runs through December 18, 2018. Interested parties are expected to send in their technical questions via email to the Technical Point of Contact (POC) before the deadline.
