Cryptocurrency news

The US IRS will track transactions using Coinbase Analytics tools

The US IRS will track transactions using Coinbase Analytics tools

The us tax service (IRS) has signed a contract with the cryptocurrency exchange Coinbase to use the analytical tools Coinbase Analytics to track cryptocurrency transactions.

The agreement will enter into force on July 23, 2020. It will be valid for a year, after which the contract can be extended. The annual fee for using Coinbase tools will be $124,950. Earlier it was reported that the Coinbase exchange has already considered the IRS and the drug enforcement Administration (DEA) as potential clients interested in the exchange’s software for blockchain Analytics. The IRS announced its intention to use Coinbase Analytics last month.

According to the Agency, Coinbase tools will allow you to analyze and track transactions with crypto assets in different blockchains, which are often used by criminals. The IRS believes that Coinbase Analytics has the functionality to effectively monitor compliance with laws.

The analytical platform Coinbase appeared after the exchange bought the startup Neutrino, whose creators were previously heads of the Italian spyware provider Hacking Team. Users were dissatisfied with the news about the purchase of Neutrino, and even offered to declare a boycott of the exchange.

Coinbase CEO Brian Armstrong explained that the acquisition of this startup entailed certain difficulties, but later the management managed to re-form the team.

“Creating such tools requires a lot of money, so we want to compensate for our expenses. There is a market for blockchain Analytics software, where we sell our tools not only for profit, but also for the benefit of users. Such cooperation will strengthen our ties with law enforcement agencies, which is important for the development of the cryptocurrency industry,” Brian Armstrong told Coinbase.

Recall that a few days ago, a Coinbase user sued the IRS for the seizure of their personal data, which could have been obtained during the prosecution of Coinbase.