The Bank for International Settlements (BIS) maintains its interest in the regulation and supervision of the bitcoin (BTC) ecosystem and cryptocurrencies. Now he has launched a project that could violate the privacy of those who use these digital assets.
Project Atlas is the pilot that the BIS will implement together with the Eurosystem and the central banks of the Netherlands and Germany. This is a proof of concept with which it is intended to closely monitor the international monetary flows of BTC and other cryptocurrencies.
Overall, Atlas will combine data on the Bitcoin blockchain and information provided by cryptocurrency exchanges into one platform that would be available to regulators around the world to oversee crypto asset operations.
To do this, Atlas is proposed to run a Bitcoin node, which will allow them to collect the data in chain. Also, that it obtains data from the exchanges. Although it is not mentioned in the project, it is presumed that it is the centralized exchange houses that provide the data, since they are entities obliged to report the information of the operations carried out by their clients.
It will be the union of this data that will allow linking wallet addresses to entities, companies or people. Atlas proposes to apply clustering heuristics, with which a network will be built that will show active flows between groups of addresses “probably controlled by the same entity in the real world,” says the BIS document.
The Bank for International Settlements and other regulators acknowledged the challenge posed to their oversight and supervision plans by the existence of transaction mixers. These are obfuscation tools, which complicate the tracking or tracking of any operation made with cryptocurrencies.
As the BIS says, mixers, such as CoinJoin, can be used even before clustering heuristics are executed. Therefore, they clarify, “Atlas follows a conservative strategy by relying solely on multi-input heuristics and identifying mixers.”
It should be clarified that the Atlas project is not the only one whose objective is to monitor operations with bitcoin and cryptocurrencies. There are already mechanisms that are used by companies and governments to track financial movements with cryptoactive, such as those offered by Chainalysis, Elliptic or Cipher Trace, to name a few.
These analysis and cybersecurity firms have an arsenal of tools that have been used in the past to, for example, track cryptocurrency transactions resulting from hacking.
However, these tools have also served to threaten the privacy of bitcoin and cryptocurrency users. And this is so since tracking companies are allies of governments, the main stakeholders in supervising and monitoring the crypto asset ecosystem.
Starting from the fact that the Atlas project seeks to group and identify the true identity of those who operate with cryptocurrencies, there are members of the community issuing multiple warnings. One of them is Sam Callahan, a leading market analyst at Swan, a bitcoin investment platform.
According to Callahan, the Atlas project would provide regulators with “a global view of Bitcoin flows, as well as the entities that are involved in transactions and their magnitude and concentration.”
This means that regulators “are beginning to better understand how Bitcoin works and the transparent nature of its network.” That shows that they are “working quickly” on building their own surveillance tools. Possibly with the idea of ending the last bastion of privacy left to humanity, such as Bitcoin.
“Therefore, it has never been more important to consider privacy than it is today and for the industry to continue to innovate and create tools that enhance private data to combat the ever-increasing surveillance state,” Callahan said.
Image: Copyright: thvideo
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