Ransomware has been on the rise as of late, and it is a cyber security threat a lot of businesses and government services are taking seriously. According to Chainalysis, the blockchain monitoring company, more ransomware-related arrests from law enforcement are on the horizon.
Can Companies Like Chainalysis Curb Ransomware and Cyber Crime?
Cybercriminals have been using ransomware threats over the past few years to extort organizations by encrypting their data and asking for a financial ransom — often in the form of bitcoin. Chainalysis has been working with law enforcement all around the world to combat this problem.
Most recently, Chainalysis helped authorities take down cyber-gang DD4BC (DDoS for bitcoin). The firm says there will be many more similar arrests in the near future.
Michael Gronager, CEO and co-founder of Chainalysis details the lowdown to Computer Weekly:
Expect to see some arrests soon as law enforcement agencies wrap up their investigations into several ransomware operations.—The ransomware industry is probably worth more than $100bn (£76bn) a year, but hopefully, our technology will help to reduce and contain that as people are arrested and sent to jail.
Gronager says in the past, bitcoin was portrayed as anonymous, but because of software like Chainalysis and its competitors he says, “Bitcoin has become less anonymous than cash.”
The CEO explains that the platform can link the source and recipient when criminals use bitcoin for ransomware, DDoS threats, and other illicit activities. Gronager tells Computer Weekly, “as Chainalysis software becomes more widely deployed, the number of jurisdictions in which cyber criminals can use bitcoins with impunity will be very limited.”
Additionally, this also applies to the recent attack against Bitfinex for 119,756 Bitcoins. The Hong Kong-based exchange hired Ledger Labs for its forensic investigation. Gronager believes the theft was a grave mistake, and he details the minute the coins are used they will be detected. The Chainalysis executive says the stolen bitcoins are in a similar to criminals “sitting on a pile of marked banknotes.”
Chainalsysis was started due to the amount of criminal activity and exchange heists over the past few years. CTO Dane Jan Moller and CRO Briton Jonathan Levin worked in the cryptocurrency exchange sector, and the three built the software in a relatively short time frame.
At first, the services were designed to help with anti-laundering techniques for financial institutions, but in time the software became a great help to law enforcement fighting cyber-crime.
Through the Barclays Accelerator Programme in 2015, the firm began creating relationships with enterprise businesses and government entities such as Europol and the FBI. Gronager expects more companies and authorities to need the software as blockchain technology continues to progress.
The Chainalysis founder says:
In the longer term, we expect blockchain to underlie most financial transactions in future, especially as it can provide unprecedented transparency if you know where to look,
The company has competition with Block Seer, Ledger Labs and Elliptic, who also work with legacy institutions and governmental organizations. As the technology progresses and blockchain technology gets more popular, criminals may resort to using a more anonymous cryptocurrency applications.
At any rate, it seems that using bitcoin for cybercrime may not be the smartest choice anymore, and will be less lucrative in the future with companies like Chainalysis monitoring public blockchains.
What do you think about firms like Chainalysis monitoring Bitcoin transactions to curb criminal activity? Let us know in the comments below.