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The U.S. Air Force has signed a contract with blockchain analytics firm Chainalysis. The one-year deal, signed on May 19, 2020, is described as a “cryptocurrency data subscription” and is worth $799,000. To date, the Air Force has made two contracts with Chainalysis worth about $910,200 total—with the first $110,500 contract being signed in June of 2018 and expiring in June 2019.

Chainalysis: a government favorite

Chainalysis appears to be a government favorite when it comes to blockchain analytics software. In the past, Chainalysis has provided its blockchain analytic tools to the FBI, the DEA, Immigration and Customs Enforcement (ICE), the Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), the Financial Crimes Enforcement Network (FinCEN), the IRS, the Secret Service (USSS), and the Transportation Security Administration (TSA).

Although neither Chainalysis nor the Air Force commented on the contract, Casey Bohn, the high-tech crime specialist at NW3C, the company that trains law enforcement officials on high-tech crimes, provided insight into why government agencies have a demand for blockchain analytic tools.

“Criminal activity involving cryptocurrency is, I hate to say this, on the rise, I think people are trying to be more novel in how they may be hiding assets,” said Bohn.

Several research reports echo Bohn’s statement and have discovered that darknet related crime and digital currency cash flows increase year over year. Studies also show that the use of digital currency coin mixers has been on the rise, which allows criminals using digital currency to easily hide their tracks.

That being said, blockchain analytics tools are becoming a mandatory resource for any digital currency service provider. Analytics tools allow their users to identify any blacklisted digital currency addresses as well as any funds that originate from illicit sources.

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