Denmark’s cybercrime police unit has claimed to have developed a specialized software system to track bitcoin transactions, one that has led to the prosecution of drug traffickers.

The revelation comes to light a report by regional news publication Berlingske. According to the report, a specialized IT system developed by the Danish National Cyber Crime Center (NC3) is described as “ground-breaking” by Kim Aarenstrup, the head of the unit. The report further adds that the same system has been used by the FBI and Europol.

“The potential of this is groundbreaking. The investigation can now proceed from where it used to stop before,” Aarenstrup said.

In roughly translated statements, Aarenstrup told the publication:

We are pretty much unique in the world at this point, because there aren’t really any other agencies who have managed to use these [bitcoin] trails as evidence in the past. Every is looking toward Denmark ins this field and we are now in close dialogue with a number of other countries right now, so we can further develop our methods and teach them how we do it.

While details of the workings of the ‘special software’ remain scarce, the mechanism reportedly correlates two separate transactions where bitcoins used to purchase illegal goods are matched against those listed on the blockchain, which are then compared with listings of the marketplace and other information about users. That’s about the extent explained by Jesper Klyve, the prosecutor involved in the cases where the tracking software led to the convictions of drug traffickers last month.

“All [bitcoin] transfers that have ever been made are coded into the bitcoin-system [blockchiain]. Therefore, you can, at any time, log in and search in the system to try and identify individual users” he told the publication.

One of the trafficking cases involved a Danish man in his 20s who purchased large quantities of methamphetamine, cocaine and ketamine on andark web marketplace.

Contrary to the popular notion that bitcoin transactions are anonymous, its pseudonymous nature leaves every transaction open to anyone looking into the public blockchain. While the wallet addresses are public – leaving every transaction openly traceable – they are not tied to any personally identifying information on the blockchain.

However, the very nature of traceable transactions leaves room for bitcoin blockchain surveillance firms like Elliptic to work with law enforcement agencies to curb online criminal activity that abuses bitcoin. Perhaps notably, Elliptic CEO James Smith stated “Bitcoin is too transparent”, adding that his firm studied major darknet drugs markets like Alphabay, every day.