- The BIS and prominent central banks launch Project Atlas, a proof-of-concept for monitoring global Bitcoin and crypto asset flows.
- The initiative merges crypto exchange data with on-chain Bitcoin specifics on a single analytics platform.
A recent unveiling has placed the Bank for International Settlements (BIS) in collaboration with Eurosystem, De Nederlandsche Bank, and Deutsche Bundesbank, leading a strategic move to heighten surveillance over the burgeoning world of cryptocurrencies. The drive behind this initiative is their launched pilot program, aptly named Project Atlas, as revealed in a tweet by Sam Callahan.
Let me tell you about a concerning new pilot program launched by the BIS, Eurosystem, De Nederlandsche Bank, and the Deutsche Bundesbank last week – Project Atlas.
Project Atlas is a Proof of Concept for surveilling the international flows of Bitcoin and all crypto-assets.… pic.twitter.com/K4FJsI16EW
— Sam Callahan (@samcallah) October 11, 2023
This ambitious endeavor is an outcome of a broader perspective laid out in the BIS report titled “Mapping the world of decentralized finance” released in October. The report highlights a pronounced gap in the availability of dependable, custom-fit data concerning the fast-evolving crypto market. Despite the lurking risks, this realm also promises significant advantages.
Project Atlas seeks to bridge this information gap. It aims to merge intricate details from cryptocurrency exchanges with comprehensive on-chain Bitcoin data. This will then be integrated into a unified analytics platform. In Callahan’s words, this platform is meant “for regulators and central banks to use to surveil.
” Further emphasizing the robustness of this project, it was mentioned, “Project Atlas creates an infrastructure to collect granular and aggregate data relevant to central banks’ mandates, from both public and proprietary sources.”
Deep Dive into the Project’s Mechanics
A deep dive into the Project Atlas mechanics reveals its plan to operate a Bitcoin node. This is to ensure the accurate collection of on-chain data. Simultaneously, data will be scraped from exchanges, linking addresses to their respective entities or even individual users.
The initial proof-of-concept showcases a blueprint for analyzing cross-border Bitcoin movements between various exchanges, with the exchange locations serving as a crucial data point. The data collection follows a structured three-step methodology:
- Grouping addresses under the control of the same actor.
- Showcasing the flow dynamics between these actor-controlled addresses in a holistic network.
- Most crucially, associating these addresses with the entities or individuals they represent.
This implies that, by amalgamating exchange data with on-chain information, the system is poised to surveil individuals more effectively. Nonetheless, BIS did admit a challenge in their surveillance pursuits: mixing services like CoinJoin, which may hinder their monitoring capabilities.