Digital Currency Forensics is the process of analyzing the data on digital devices to determine if someone is actually using your digital currency for fraudulent purposes. These investigations may be performed to track down individuals who may be hiding assets in cryptocurrency. The process often involves collecting data from various devices, such as computers, mobile phones, and hardware wallets. The experts at CipherBlade specialize in this area, and can extract the data from digital devices to assist with recovery of funds.
Blockchain
Blockchain-based digital currency forensics provides a number of significant benefits for digital currency forensics investigations. These include the reduction in data storage requirements, increased efficiency of transactional analysis, and reduced investigation costs. To understand how blockchain-based forensics works, we will look at a few examples.
Blockchain-based digital currency forensics focuses on the tracking of cryptocurrency assets on the public blockchain. The blockchain is a database of all cryptocurrency transactions and wallet addresses. Because the blockchain is public, it is vital to accurately assess the information that is publicly available. Proper tracking and reporting is necessary to determine if funds are being abused or misappropriated.
Blockchain-based forensics tools provide law enforcement and the public with crucial evidence. For example, Blockchain-based digital currency forensics tools can help police identify and disrupt criminals who use digital currency to launder money.
Tools for tracing transactions
The IRS is looking for new tools to trace digital currency transactions. They are particularly interested in tools that can track privacy-centric tokens and off-chain transaction protocols. The IRS has set a July 14 deadline for submissions of interactive prototypes. This toolkit is built with artificial intelligence and smart algorithms to adapt to the latest industry services, platforms, and digital wallets.
Blockchain intelligence tools help investigators trace cryptocurrency transactions by analyzing the flow of funds. For example, they can look at the transaction history between two distinct parties and determine whether there are any suspicious transactions. This is particularly useful when investigating hacking cases, because cybercriminals often move funds through multiple addresses in an effort to confuse investigators. One example of this is when a hacker steals a large amount of funds from an exchange and sends it to multiple addresses.
Automated risk-scoring
Automated risk-scoring for digital currencies is a powerful tool that can be used by financial investigators to ensure compliance and protect customers. It can also be used by exchanges to identify the source of stolen funds or identify bad actors. With real-time analysis, law enforcement agencies can take immediate action, including freezing the funds.
The use of automated risk-scoring tools can increase the efficiency of digital currency forensic investigation workflows. In particular, these tools allow security investigators to cross-reference responses to security questionnaires across different organizations. In addition to this, they automate the exchange of cybersecurity questionnaires. Moreover, they make it easy to populate questionnaires with stored data.