Monero (XMR) is proving to be a tough cookie to crack for the tax watchdog.
U.S. IRS Wants to Crack Monero (XMR)
Financial watchdogs across the world are famous for their strict stance toward cryptocurrencies. Further, when it comes to privacy-centric cryptocurrencies, things are even worse.
This was evident from a recent proposal published by the U.S. Internal Revenue Service (IRS).
According to the proposal, the IRS has offered a bounty of up to $625,000 to anyone who can break the premier privacy-centric cryptocurrency Monero (XMR) and trace transactions on Layer-2 Bitcoin payments solution, the Lightning Network (LN).Th
Per sources close to the matter, the IRS will accept submissions in the form of working prototypes until September 16. Should an applicant’s entry be accepted, they will receive an initial payment from the watchdog.
The grant’s aim is to enable the applicants to develop their prototypes into a working product within a time period of eight months. Post the successful development, implementation, and government approval of the application, the applicants will receive another $125,000 worth of grant.
The announcement reads:
“IRS-CI is seeking a solution with one or more contractors to provide innovative solutions for tracing and attribution of privacy coins, such as expert tools, data, source code, algorithms, and software development services.”
Developers to Help the IRS Criminal Investigation
Interestingly, the initiative’s primary objectives include helping the IRS Criminal Investigation, and to help special agents trace cryptocurrency transactions – including all transaction details such as the date, time, and the wallets involved in the said transactions.
It’s also worthy of note that the final product must also give complete control to the IRS CI, including the ability to further develop or modify the product so as to minimize IRS’s dependency on any external vendor.
This development should hardly come as a surprise to the larger cryptocurrency community as BTCManager previously reported that the U.S. authorities were developing techniques to track privacy-focused cryptocurrencies like Monero (XMR) and Zcash (ZEC).
However, things are not as lopsided.
Earlier this year, BTCManager reported that Monero had officially launched version 0.16.0.0 of its software dubbed “Nitrogen Nebula” with enhanced privacy and speed.