With malicious DDOS attacks and ransomware on the rise, it’s no surprise that law enforcement wants to get a grasp on this technology. Blockchain intelligence company Elliptic has just received funding for $5 million USD to help curb cryptocurrency related crime with one of the investing firms headed by a former NSA director.
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Law Enforcement is Working with Blockchain Monitoring Services
Blockchain intelligence firm Elliptic has officially announced it has raised $5 million USD to make this industry “safe for the enterprise.” Elliptic was founded in October of 2013 by Tom Robinson, Adam Joyce, and Dr. James Smith. The business uses data and analytics to watch for blockchain compliance, fraud detection, and criminal investigations.
The recent funding round led by Paladin Capital Group, along with Santander InnoVentures, KRW Schindler, Digital Currency Group, and existing investor, Octopus Ventures. Paladin Capital Group is headed by former NSA director Lieutenant General (Ret.) Kenneth Minihan, who spoke highly of Elliptic’s services. The private firm headquartered in Washington DC concentrates on software and security platforms that help law enforcement agencies.
“Elliptic has demonstrated a powerful working product that can combat illicit activity on blockchains,” said Minihan in the official announcement. “Elliptic is a game-changer for blockchain and is already trusted by some of the smartest minds in law enforcement and compliance.” He added:
We recognize that the firm’s monitoring capability will be an essential component of any blockchain in the future and we will help Elliptic to expand in the US, via our contacts and knowledge of US law enforcement and government agencies.
The London and New York-based Elliptic believes there will be “strong demand” for its analytical services. Last summer the team had created a visualization platform that connects transactions in a string-like pattern. The company states that leading European and U.S. exchanges have adopted Elliptic’s compliance and fraud detection and that the system has been used to “assess risk on more than $2 billion in Bitcoin transactions.”
Additionally, the business details it already has helped law enforcement worldwide with crimes like arms trafficking, narcotic sales, extortion attempts, and money laundering.
Growing Demand for Blockchain Intelligence
Tracking criminal activity through the blockchain is gaining steam. Back in February, another blockchain analysis competitor, Chainalysis Inc, signed a memorandum with Europol and raised $1.6 million. The New York-based company will also assist officials with tracking criminals.
Ransomware has been on the rise with malicious malware like TeslaCrypt, which has been currently deemed “unbreakable” by experts Heimdal Security. Also organizations like Hollywood Presbyterian Medical Center recently paid out $17,000 in bitcoin to extortionists due to ransomware. Hackers have also recently attacked four computers with ransomware in the Ottawa Hospital network. Officials say no patient data was leaked as IT staff had been able to wipe the malware from the system.
Elliptic believes they are creating a standard of blockchain monitoring services to help fight cybercrime. The firm has been awarded “Security product of the Year” by The Banker magazine and was a winner of the Swift Innotribe Startup Challenge.
Founder and CEO of Elliptic Dr. James Smith believes his company has established itself as a leader in this market space. The CEO explained in the announcement:
Our new investors bring deep expertise in law enforcement, international financial services, and blockchain technology and we are excited to work with them on our next phase of growth. We have already been able to expand operations to the US and will continue to extend our portfolio of products.
It appears that interest from law enforcement for monitoring blockchain and cryptocurrency activity will only grow in lockstep with the development of cybercrime. As former NSA directors and Europol authorities invest in companies that provide these services, people will soon wonder just how much information is being collected and may opt for anonymizing tools and cryptocurrencies that offer greater privacy.
What do you think about blockchain monitoring organizations like Elliptic and Chainalysis? Let us know in the comments below.
Images courtesy of Elliptic’s Website and Pixbay