Australian law enforcement tracking Bitcoin use on black market

Australia's national criminal intelligence agency is tracking the use of virtual currencies such as Bitcoin on online black markets as part of its new 'Project Longstrike' operation.

The Australian Crime Commission's executive director of strategy and specialist capability, Judy Lind, today revealed the agency is now monitoring Bitcoin-enabled crime after spending the last two years building technologies capable of tracing Bitcoin transactions.

"The ACC has assessed that organised crime groups continue to make use of darknets to harbour trading in illicit commodities, including child exploitation material, illicit drugs and firearms, stolen credit card and identity data, and hacking techniques," Lind said in a statement.

"The aim of Longstrike is to develop an enhanced understanding of the national and international environment in the detected misuse of virtual currencies to facilitate criminal activity."

She said insights gained from the operation would be used to develop legislative, regulatory, policy and other risk mitigation response strategies.

Virtual currencies like Bitcoin are slowly gaining more attention from law enforcement and regulatory bodies as more businesses accept them as payment.

A parliamentary committee is currently studying how to protect against the use of anonymous currencies for criminal purposes as well as how to apply a regulatory framework to the crypto-currencies.

Earlier this year the Australian Tax Office released long-awaited guidance on how it intended to treat Bitcoin and other electronic currencies for tax purposes, ruling that they are neither Australian money nor foreign currency and therefore not taxable under an individual's income.

Details of the Crime Commission's operation follow a week after a Queensland man was extradited to the US over his alleged involvement in the now-defunct Silk Road marketplace.