A lot of people currently hold their cryptocurrencies in crypto wallets, special software and devices that store the public and private cryptographic keys for tracking cryptocurrency ownership and allowing users to send, receive, and store digital currency.
Despite the fact that cryptocurrencies and wallets are legal, they are often used in ransomware attacks, where criminals require payment in virtually untraceable Bitcoin(It’s not exactly untraceable). In the event a hardware crypto wallet — one of the most secure wallet types that is often used to store large amounts of cryptocurrency — is submitted as evidence in a criminal investigation, law enforcement has no way of accessing the data if the owner is unwilling or unable to unlock the wallet.
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IRS plans to crack Cryptowallets:
Currently, the IRS’ Criminal Investigation unit is working to unlock cryptocurrency wallets so that investigators can more easily trace the movement of cryptocurrencies and potentially recover stolen assets and prevent digital currency theft. They want to unlock the wallet to recover the coins.
The IRS will partner with Colorado-based VTO Inc. on a research and development project to discover ways of gaining access to crypto wallets by exploiting hardware, software and firmware vulnerabilities in secure devices.
To this end, IRS aims to develop research findings relating to cryptographic wallet exploitation, utilizing digital forensics to analyze firmware, reverse engineer hardware, and deconstruct printed circuit boards and integrated circuits. A digital forensics laboratory should be able to teach and follow a consistent, repeatable process for gaining access to wallets, even if they are present and not operational.
The VTO team will first demonstrate how it can compromise the integrity of cryptowallet protections and access the contents of a single type of device, either a specific model or a single type, and exploit that. The VTO will work on identifying trends in exploitation techniques, as well as all variables that are consistent across different devices, once this practice is applied consistently.
The administration wants to tax the rich. Rich people, on the other hand, may well not be concerned with the issues because they can afford costly attorneys. More taxes will be paid by the middle and lower classes.
VTO will provide the IRS with “device-specific acquisition and exploitation processes, guides, and training for each device topic for use in a digital forensics laboratory.”