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Using Analysis to Fight Crime

Criminals and rogue nations transact with each other on these public be compromised if they’re not properly may believe they can hide ledgers. For example, we can show that configured. Having said that, stolen funds behind and a given transaction took place between can be traced. You literally can see where blockchain transactions, two different cryptocurrency exchanges or funds go on the blockchain, because but blockchain analysis between a cryptocurrency exchange and everything is open. makes that more difficult. an illicit entity, such as one conducted by a Don Spies, Director of sanctioned individual or organization. With What should organizations look for in a Market Development for blockchain analysis tools and exchanges' blockchain analysis solution? Chainalysis, discusses how know your customer (KYC) information, It comes down to having the right data law enforcement agencies law enforcement can gain transparency and making it actionable. Specifically, can use this cutting-edge into blockchain activity in ways that aren’t law enforcement should be interested in technology to fight crime. possible in traditional finance. a partner with data attributing services, which attribute addresses to the clusters Discuss the use of blockchain analysis — that is, the entities — that control What opportunities do in other areas of the justice system. them. In this case, that would be clusters present for law enforcement agencies? It’s a burgeoning field, and use cases are associated with criminal activity and their Cryptocurrency offers an unprecedented still being discovered. The unique nature cashout points. opportunity to quantify and investigate of this is that blockchains are completely The historical data behind this financial crime. are the open. Anyone can go to a blockchain capability is an important differentiator. first global payment system outside of website and see all the data Chainalysis is the only company that has any single organization’s control, and their that’s there. Depending on the scenario systematically collected information that blockchains create permanent public records, and the blockchain analysis tools used, links real-world entities to blockchain or ledgers, of illicit activity. Although crime organizations can follow the money on transactions since 2014. This allows the makes up a small subset of a much larger the blockchain, monitor transactions software to accurately distinguish different cryptocurrency market — one percent for suspicious activity and anti-money clusters of entities and attribute more data — it remains significant. For example, laundering compliance, and obtain profiles than can be seen on the blockchain. cryptocurrency is used for , of cryptocurrency businesses. Information terrorist financing, darknet markets, child gleaned from blockchain analysis can be What is the biggest misconception abuse material, ransomware, scams and more. used in a court of law. about cryptocurrency? Fortunately, the transparency afforded by Cryptocurrency’s decentralized, semi- blockchains helps law enforcement weed Are there hacking or other security autonomous nature makes it uniquely out bad actors. This will help build trust in issues associated with blockchains and appealing to criminals, and their embrace blockchains and pave the way for mainstream cryptocurrency? of the technology has helped shape its uses of cryptocurrencies. To my knowledge, no one has ever hacked overall reputation. But in fact, unlike the major coins, such as . Hacking cash and other traditional forms of value What is blockchain analysis and how the technology underlying cryptocurrency, transfer, cryptocurrency is inherently are law enforcement agencies using it? which is the blockchain, would require an transparent and easier to trace. Every Blockchain analysis helps people interpret amount of computing that doesn’t exist transaction is recorded in a publicly the public blockchain ledgers. With right now. What’s important to understand visible ledger. With the right tools, we Chainalysis tools, government agencies is there are on-ramps and off-ramps in can see how much of all cryptocurrency can understand which real-world entities coin infrastructures like exchanges that can activity is associated with illicit activity.

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