UK’s HMRC Looks To Track Top Crypto’s, Including Privacy Coins With Blockchain Analytics Tool

Her Majesty’s Revenue and Customs (HMRC) in the UK has just opened a £100,000 ($130,000) for procuring a software that traces when cryptocurrency is being used and taxes don’t get paid.

In other words, the HMRC wants to have the ability to monitor crypto transactions and to identify the people who are using gambling and mixing service providers, or are operating on the dark market. Published on January 17, the contract notes that the software has to trace Bitcoin (BTC), Bitcoin Cash (BTH), Ethereum (ETH), Tether (USDT), Ripple (XRP), Litecoin (LTC) and Ethereum Classic. Those who can deliver a program that can trace Zcash (ZEC), Dash (DASH) and Monero (XMR) will be given preferential treatment. This is what it reads exactly:

“Crypto assets, such as Bitcoin and Ethereum, provide a means to transfer value between interacting parties. These services are increasingly used for a range of purposes, from international money transfers, sales of digital services, paying staff, and tax evasion and money laundering.”

If the HMRC succeeds in implementing this tracing system, it can close the gaps when it comes to the use of cryptocurrency and illegal activities against the tax agency.

Tax Offices All Over the World Struggling with Cryptocurrency

It has been reported that in 2019, British authorities have demanded a list of customers and transactions from all crypto exchanges operating in the country. Their intention was to recoup unpaid taxes. In the same time period, the Internal Revenue Service (IRS) in the US sent over 10,000 letters to crypto users that have done transactions of $20,000 or more in cryptocurrency, from 2013 till 2015. The letters contained warnings of the penalties they will suffer if their income is not correctly reported or the crypto transactions’ taxes aren’t being paid. People who received these letters had to sign statements in which they were saying that they have reported their income correctly, the charge for not doing so being perjury.

When it comes to the HMRC, tracing XMR and other cryptocurrencies that are rather anonymous may prove to be very difficult. Back in 2019, a strategy analyst from Europol noted that authorities all over the world are still struggling to trace crypto transactions.

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Author: Oana Ularu

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