Russia has begun to build a cryptocurrency tracking tool aimed at combating illegal activity on the blockchain.
Russia’s financial watchdog group, Rosfinmonitoring, is ramping up its anti-crypto crime efforts with a new tracking tool under development. According to a website that tracks Russian government contracts, the watchdog group has hired a contractor to build the tool after a $200,000 offer was accepted. A company named RCO won the contract and will handle the “Implementation of work on the creation of a module for monitoring and analyzing cryptocurrency transactions using bitcoin.” RCO is a major information technology company in Russia backed by Sber, formerly Sberbank.
The tool is reportedly being developed to fight against illegal activity using cryptocurrency as a cover. Crypto wallets determined to be related to criminal activities or the financing of terrorism will be targeted specifically by the tracking tool.
According to the official contract, the software will also be used to monitor the behavior of the crypto market in order to identify users who are likely to have participated in illegal activities. The tool must allow for the “monitoring of the behavior of participants in the cryptocurrency market was provided in order to identify them, compile profiles of participants and assess their role in economic activity, as well as identify the likelihood of their participation in illegal activities,” states the Federal Financial Monitoring Service.
Other nations cracking down on illegal blockchain activity
Russia is not alone in its war against illegal crypto activity within its borders, with several countries fighting the same fight against digital crime. South Korea is one such nation that stated there will be “no illegal cryptocurrency transactions,” in the country moving forward. The promise came out of an April meeting between the Financial Services Commission, the Ministry of Justice, The National Police, and the Ministry of Finance.
The officials will use strict regulations to work in conjunction with a new law that requires anyone with virtual assets to identify themselves to service providers. In turn, the providers are required to share that information with the government. Failure to do so will result in heavy fines for any exchange not following the rules. More recently, US Senator Elizabeth Warren once again shared criticism of cryptocurrencies and called for additional regulations on Thursday.
The vocal Warren called on policymakers to protect investors from crypto-scams and market manipulation. The Senator believes such crimes are not punished as harshly as they should be. Speaking with Bloomberg TV, Warren stated that “So long as it’s an unregulated system, you may be pulling more people in so that they can get cheated and that’s not what we want.”
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