Regulators’ attempts to trace transactions on the Monero network, the privacy-focused cryptocurrency, are doomed to fail, according to its former lead maintainer Riccardo ‘Fluffypony’ Spagni.
\”The U.S. Internal Revenue Service (IRS) wants to understand Monero at the same level as digital dollars on bank accounts. But cryptographers and researchers will always stay one step ahead on privacy matters,\” said Spagni in a comment to CoinDesk.
In his view, regulation will be effective at specific points. By these, Spagni means trading platforms or payment service providers that can verify users.
A major Monero update has increased transaction speed by compressing the data volume
Elliptic co-founder and chief economist Tom Robinson shares a similar view. Building a tool to track Monero would be a temporary solution, he says. In the future, developers will simply fix the vulnerabilities.
Earlier, CipherTrace said that, at the request of the U.S. National Security Agency created a tool to track transactions on the Monero network. In response, the developers introduced the Triptych algorithm, designed to further protect the anonymity of transaction participants.
In September the IRS offered $625 000 to a contractor who would bypass Monero’s privacy technologies. In the bidding, the companies Chainalysis and Integra FEC won.
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