Blockchain-based data analytics startup Chainalysis has completed a $1.6m seed finance round led by Point Nine Capital and including Techstars, Digital Currency Group, Funders Club, and Converge VP as participants.
The New York-based startup has also signed an agreement with Europol’s European Cybercrime Centre (EC3) on collaborating to fight online crime.
Blockchain technology, particularly Bitcoin, has been challenged by negative headlines connecting use of digital currencies with fraud, cybercrime and terrorism financing. As described in a report by Europol last year, cybercrime is becoming a large business with criminals leveraging different aspects of cloud infrastructure and often extorting their victims in Bitcoin.
The Europol-Chainalysis agreement includes collaboration and information sharing to tackle cybercrime. Through the agreement, Chainalysis hopes to improve public perceptions of the blockchain by using it as a tool to detect digital identities of criminals on the blockchain, detect suspicious activity in real time and provide investigation tools for law enforcement to tackle cybercrime.
As noted by Michael Gronager, CEO of Chainalysis:
“We have worked extensively with regulated entities and law enforcement agencies in US, Asia, and Europe to help protect people and businesses from cybercrime attacks. This new collaboration is an important next step in the endeavour to move digital currencies out of the hands of the criminals and into the hands of consumers and blooming commerce.”
Steven Wilson, Head of Europol’s EC3 added:
“Chainalysis brings a level of expertise that will be of significant benefit to our Europe-wide investigations. I look forward to developing a rewarding partnership that will make the people and businesses of Europe safer online.”
This collaboration follows the recent news of Chainalysis’ contract with Barclays to use Chainalysis’ compliance tools to enable banks to interact with businesses that transact on the blockchain and meet their compliance requirements. The majority of banks have thus far had security issues with doing business with Bitcoin companies. Chainalysis believes that its tools will enable banks to provide services to companies that conduct commerce over the blockchain. For these tools, Chainalysis leverages the blockchain itself to provide banks with transparency on the activity of such companies that the banks bring onboard.