U.S. Government Seeks To Purchase Blockchain Analytics Software From Coinbase

Two government agencies — the Internal Revenue Service (IRS) and the U.S. Drug Enforcement Administration (DEA) — are looking to purchase blockchain analytics software from Coinbase to assist in their investigations, according to public records.

Both the IRS and DEA are seeking sole source contracts with Coinbase. The IRS detailed how the cyber crimes unit needs a software to trace various cryptocurrencies across blockchains in order to gather evidence against individuals using crypto for criminal activity.

“In addition to the Bitcoin Blockchain, Coinbase Analytics (fka Neutrino) allows for the analysis and tracking of cryptocurrency flows across multiple blockchains that criminals are currently using,” The IRS document reads.

The IRS report’s mention of Coinbase’s acquisition of the controversial intelligence firm Neutrino is worth note. Several Neutrino executives founded an Italian firm that sold Remote Control System software to government organizations in Egypt, Saudi Arabia, Russia and Turkey among others which posed threats to human rights and privacy.

The Drug Enforcement Administration released a redacted version of their documentation of the proposed purchase. The available information stated that the software would allow investigators to de-anonymize virtual currency addresses. It also highlighted the DEA’s need for a real time blockchain tracing tool to quickly verify potentially suspect transactions.

The listed period of performance on the DEA document is April 3, 2020 through April 2, 2020. The IRS document says the period is one base year from the date of award. Coinbase does not come up in USAspending.gov, which lists government awarded contracts, so it is unclear whether or not the contracts are active.

By Emily Mason

Related Articles