The IRS has signed a contract with cryptocurrency exchange Coinbase to use 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 was already considering the IRS and the Drug Enforcement Administration (DEA) as potential customers interested in the exchange's blockchain analytics software. The IRS announced its intention to use Coinbase Analytics last month.
According to the ministry, Coinbase tools will allow analyzing and tracking transactions with cryptoassets in different blockchains, which are often used by criminals. The IRS believes Coinbase Analytics has functionality to effectively monitor compliance.
The Coinbase analytics platform came about after the exchange bought the startup Neutrino, whose creators were previously the heads of the Italian spyware provider Hacking Team. Users were dissatisfied with the news of the Neutrino purchase, and even offered to declare a boycott to the exchange.
Coinbase CEO Brian Armstrong explained that the acquisition of this startup entailed some difficulties, but later the management was able to reorganize the team.
“The creation of such tools is costly, so we want to offset our costs. There is a market for blockchain analytics software where we sell our tools not only for profit but also for the benefit of users. This collaboration will strengthen our ties with law enforcement, which is important for the development of the cryptocurrency industry, ”Brian Armstrong told Coinbase.
As a reminder, a few days ago, a Coinbase user filed a lawsuit against the IRS for seizing his personal data that could have been obtained in the course of the Coinbase prosecution.
