The U.S. Internal Revenue Service (IRS) spoke it’s working nearly with Ukraine to help it trace crypto deals of Russian sanctions evaders. The agency is giving the Ukrainians access to a Chainalysis tool as well as specialized practice for Ukrainian law enforcement.

IRS Offers Ukraine Tools From Chainalysis to Trace Russian Blockchain Transactions

The criminal investigation division of the United States Internal Revenue Service published it's stepping up cooperation with counterparts abroad as part of efforts to identify persons and entities evading Western sanctions.

The agency revealed it’s working with blockchain forensics firm Chainalysis & Ukrainian investigators to track Russians who might be utilizing cryptocurrencies to conceal their assets amid financial restrictions imposed over Moscow’s invasion of Ukraine.

According to the report, the IRS is sponsoring Ukraine’s access to a Chainalysis tool facilitating crypto-related probes. It has similarly organized training sessions for the country’s law enforcement, both virtual and in-person, on tracing blockchain deals.

These efforts are expected to upgrade facts-sharing and case development between the U.S. and Ukraine, the earnings service explained in a statement. remarking on the cooperation, IRS Criminal Investigation Chief Jim Lee emphasized:

Sharing tools not only safeguards the U.S. financial system, but the global economy.

Authorities around the world have published warnings that sanctioned countries like the Russian Federation and Iran may be utilizing crypto to bypass international restraints. Another report newly revealed that the world’s largest crypto exchange is facing an investigation by the U.S. Justice Department over suspected violations of Russia sanctions.

According to Michael Gronager, co-founder and chief executive of Chainalysis, crypto is quietly too illiquid to back mass sanctions evasion but this does happen on a smaller scale. Work to establish how much Russian oligarch money is flowing through Ukraine is running on, he added.

Gronager similarly remarked that cryptocurrency is playing an unprecedented part in the war through donations in support of both sides. Around $5 million have been transferred this way to roughly 100 pro-Russia groups over the past year, he pointed out as an example. Utmost crypto assets sent from wallets sponsoring Russia reach centralized exchanges, exploration showed in March.

Ukraine and the United States have been working out together on different crypto-related fronts. backed by U.S. law enforcement, Ukrainian police disrupted a network of crypto exchange services suspected of laundering criminal proceeds from ransomware attacks and fraud schemes, publishing the shutdown of 9 similar platforms earlier in May.

(Lubomir Tassev, Bitcoin.com, 2023)