As part of a $200,000 procurement contract, a Russian company indirectly backed by Russia’s largest bank will build a crypto tracking platform.
Russian federal authorities are moving forward with a plan to closely monitor cryptocurrency activity for illegal transactions and to deanonymize the identities of crypto users.
The Russian Federal Financial Monitoring Service, or Rosfinmonitoring, has chosen a contractor to create a platform for tracking cryptocurrency activity. According to data from Russia’s state procurement website, the country will spend 14.7 million rubles ($200,000 USD) from its budget to develop a “module for monitoring and analyzing cryptocurrency transactions” that will use Bitcoin (BTC).
According to official data, the procurement contract was awarded to RCO, a company that is reportedly indirectly backed by Russia’s largest bank, Sber, formerly known as Sberbank.
RCO will be tasked with developing a monitoring tool for tracking the movement of digital financial assets and maintaining a database of cryptocurrency wallets involved in illicit activities, as well as monitoring crypto users’ behavior in order to identify them, according to the contract documentation.
The platform will also be designed to compile detailed profiles of cryptocurrency users in order to assess their role in economic activity as well as the likelihood of their participation in illegal activities. According to Rosfinmonitoring, Russia’s upcoming cryptocurrency tracking tool will improve the efficiency of primary financial monitoring and compliance while also ensuring the safety of budget funds.
This latest development is another step forward in Russia’s efforts to track cryptocurrency transactions, which began a year ago when Rosfinmonitoring announced the “Transparent Blockchain” initiative to track the movement of digital financial assets.
As previously reported, the authority intended to “partially reduce the anonymity” of transfers involving major digital assets such as Bitcoin and Ether (ETH), as well as privacy-focused cryptocurrencies such as Monero (XMR).Rosfinmonitoring first announced plans to track crypto transitions in August 2018.