U.S. tax authorities want assistance with accessing digital currency hardware wallets, Vice reported Thursday (April 29), citing a document published on the agency website in March 2021.
IRS Criminal Investigation, the law enforcement division of the Internal Revenue Service, and the Digital Forensic Unit are seeking to have contractors devise methods to break into digital currency wallets.
A number of investors who hold digital currency keep their cryptographic keys on a personal device or an exchange they harness for transactions. By contrast, certain individuals desire a bit of additional security and harness hardware wallets. Those are small tangible drives that safely keep a user’s keys and are not linked to the web.
However, the safety of hardware wallets poses a challenge for those looking into a case. Agencies might physically have a hardware wallet, yet they might not have the capacity to access it if the suspect isn’t willing to help.
The IRS is also reportedly looking for technologies that it can use dependably in different cases in the future — not tools or solutions that can only be used once.
“The explicit outcome of this contract is to tame the cybersecurity research into measured, repeatable, consistent digital forensics processes that can be trained and followed in a digital forensics’ laboratory,” the document said, according to Vice.
The news comes as IRS Commissioner Charles Rettig said onTuesday (April 13) in front of the Senate Finance Committee that the country fails to collect approximately $1 trillion in taxes yearly due to the new popularity of digital currency. Cryptos are challenging for the agency to monitor and levy.
Nonfungible tokens (NFTs), Rettig said, are just more of that same kind of issue for the agency.
“So now we have these nonfungible tokens, which are essentially collectibles in the crypto world,” Rettig said, as per a published report. “These are not visible items by design. The crypto world is not visible.”