The IRS investigates crimes on the dark web that include cryptocurrencies. The agency is preparing a law to be able to snoop on cryptocurrency transactions.
The excitement that non-fungible tokens (NFTs) are generating in the digital world, but mainly the profits they are receiving in the cryptocurrency market, has set off the alarms of the coordinator of the United States Tax Service (IRS), Charles Rettig.
In an interview by the US network CNBC, Rettig indicated that the entry into the scene of the NFTs represents a way for “tax evasion”, as “they are not visible by design as is the case with cryptocurrencies.”
Retting also assured that the popularity of cryptocurrencies and their massive adoption had been why they cannot gather the sum of USD 1 billion in taxes per year. This adoption happens because they are facing some difficulties in tracking transactions.
The official assured that IRS has been investigating “cybercrimes that have been developing with cryptocurrencies on the dark web.”
Retting also revealed that the IRS is preparing a bill with which they intend to request more information and disclosure of cryptocurrency transactions since it considers it essential to “have that information.”
This request is something other organisations such as the US agency against financial crimes (FinCEN) approached this year, with a regulation proposal that turns the wheel in self-custodial cryptocurrency wallets.
IRS Asked Customers if they Acquired Virtual Currencies to Measure their Interest
In this sense, since last year, the IRS incorporated into the form with which North American citizens file taxes the question: “At any time during 2020, did you receive, sell, send, or acquire any financial interest in virtual currency?”
The IRS desires to control the use of cryptocurrencies with more strength, using tax evasions as a disguise for its real intentions. This war for control is a topic that has been going on for several years. In 2016, the United States of America government, through the IRS, requested the popular exchange Coinbase, the private information of its clients, which started a huge legal battle.
In 2017, the US court concluded that less than 1% of Coinbase’s customer base would need an investigation. Those selected for scrutiny by the government agency benefited somewhat, as the amount of data that requires the IRS saw a significant reduction.
IRS Pays the Tracking of Financial Operations with Monero
The efforts of the North American Tax Service to increase control over cryptocurrencies and the fear of a possible loss of control over monetary policies led them to pay USD 1.25 million to the companies Chainalysis and Integra FEC. This massive payment had the intention to track every transaction in Monero and second-layer solutions like Bitcoin’s Lightning Network and Ethereum’s Raiden.
According to the agency, there are limited resources to track transactions related to private cryptocurrencies such as Monero and “other off-chain transactions that provide privacy to illicit agents.”
By: Jenson Nuñez