South Korea blockchain companies are helping prevent cryptocurrencies and other digital assets from being used for nefarious purposes.
CoinTelegraph’s Korean-language edition reports that local blockchain company Lamda256 is taking part in a national R&D project to develop technology to track the use of digital assets in illegal transactions and criminal activity.
Lambda256 is run by Dunamu, the company that operates major South Korean cryptocurrency exchange UPbit.
The R&D project, led by the Korea Internet and Security Agency (KISA), involves several other organizations and companies, including prosecutors, the national police university, Chungnam National University and network security firm NSHC.
South Korean investigative and security bodies are working with blockchain and digital asset companies to combat rising instances of illicit activity on the so-called “dark web.”
KISA and the other entities taking part in the joint R&D project plan to develop core technology to track illegal digital asset transactions and cyber crimes based on research to be completed by the end of the year. The technology will then be gradually refined and commercialized through trial projects with cryptocurrency exchanges.
The project also comes as local cryptocurrency exchanges work to bring themselves into compliance with the “travel rule” included in the FATF guidelines. A KISA official told CoinTelegraph that while large exchanges are building KYC and AML solutions, there’s also a need to develop technology to determine which digital asset wallets are exposed to criminal activity and to track illegal digital asset funds.