The National Police Agency has mapped out a policy to introduce software next fiscal year to visualize the transaction history of virtual currencies in the face of increasing money laundering, massive theft and other cases related to cryptocurrencies.
The software can extract transaction data needed for an investigation from an enormous volume of data, making cyber investigations more effective. Blockchains, a form of digitized public ledger, manage all cryptocurrency transactions. It usually takes a long time to find and trace specific data in a blockchain because of the massive number of transactions.
The special software developed by a private company can extract transaction data needed for investigations. The software can also show information of virtual currency exchange operators, information that is not found in blockchain databases.
In January, Tokyo-based virtual currency exchange operator Coincheck Inc. had a massive amount of its NEM cryptocurrency stolen.
The anonymous nature of virtual currencies make them a favorite for use in money laundering as well.
Last year from April to December, at least 669 "suspicious transactions" were reported to the government.
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