U.S. SEC is considering a blockchain forensics tool for smart contracts

Blockchain technology promises to revolutionize many aspects of how we do business and, if you believe the blockchain hype (of which there is plenty), may even be as disruptive as the internet was before it.

Despite this, practical, real-world examples of blockchain technology can be a little thin on the ground – and that makes it harder for businesses to envision how they might implement the technology in the future.

One of the most unlikely news is reported by Bitcoin.com that the U.S. Securities and Exchange Commission (SEC) is looking for a blockchain forensics tool to help it analyze smart contracts.

In a call for bids to software companies on July 30, the regulator said that the tool must be able to “analyze and detail code within blockchains and other distributed ledgers.”

It is also looking to identify contract changes performed with administrator passwords, in addition to issues like whitelisted and blacklisted addresses. It also wants to know how token sales funds are disbursed.

The SEC noted that the smart contracts tool would support its efforts “to monitor risk, improve compliance, and inform Commission policy with regard to digital assets.”

Firms have until August 13 to submit their proposals. Only companies classified as “small businesses” – those with a value of $30 million or under – are being considered for the tender, it said.

SEC’s desired analysis tool gives it ability to track the movement of crypto transactions more closely, particularly those contracts in the multi-billion-dollar decentralized finance (Defi) industry.

The Commission, which recently awarded a contract to blockchain analytics firm Ciphertrace for its crypto-tracking capabilities, is obviously aiming at becoming a better player in a digital asset industry where it has always been on the backfoot.

According to a notice published in July, the Ciphertrace deal is limited to blockchain forensics and intelligence targeting Binance’s native coin BNB and all the tokens on the Binance network.

The SEC has had running battles with several crypto companies that include Telegram. Initial coin offerings (ICOs) have also proved to be a sore point for the regulator.