Emphasizing the importance of blockchain intelligence in money transactions and picking up on a burgeoning financial forensics industry, the company seems set to go far
Blockchain, a method of tracking bitcoin transactions and sifting out fraud, is a hot topic. That isn’t because bitcoin has gotten anymore popular: Rather blockchain technology is being applied to other industries, and currencies, aside from bitcoin. Businesses are willing to pour millions into adopting variations of the technology and integrating it into their analytics and data intel.
Elliptic’s new $5 million funding round led by London-Washington venture capitalists Paladin Capital Group – whose managing director, Christopher Steed, will join Elliptic’s board – further demonstrates bitcoin’s increasing relevance to financial technology. Santander InnoVentures, KRW Schindler, Digital Currency Group, and Octopus Ventures also participated.
Elliptic maps bitcoin accounts across the light and dark web, skimming for clues and references to bitcoin wallets that can help identify the actual identity – or at least the source – of a wallet and its ensuing transactions. Elliptic touts having supplied financial forensic evidence to law enforcement agencies worldwide related to “international arms trafficking, money laundering, theft and drug offenses.” Of course, they also provide intelligence to financial institutions.
In time we will use our technology to identify patterns in other blockchains, but for now we are focusing on improving our current Bitcoin product offerings for law enforcement and financial institutions. They boast having worked with several agencies both in the United States and Europe.
“Our technology is a critical step towards making banks feel comfortable engaging with Bitcoin and Bitcoin companies,” Elliptic CEO and Co-Founder Dr. James Smith told Geektime, saying his company’s tech had been used to assess billions of dollars worth of transactions. “The immediate impact is that Bitcoin companies will find easier to interact with banks if they use Elliptic’s technology and have a robust compliance program in place.”
It’s all about the blockchain
They’re hardly the first startup in the bitcoin, blockchain and distributed ledger game. Israeli startup COLU raised $2.5 million last year for its blockchain-based IoT security. Japan’s Orb markets a blockchain-based cloud platform. Co-investor Santander InnoVentures told Geektime last year that it was imperative to get more people with expertise to focus on blockchain technology, as “finding people who have experience in coding enterprise level cryptography are like finding a needle in a haystack.”
Lead investor Paladin adds another feather in its healthy cyber security cap which includes stakes in BA Insight, Bugcrowd, CloudShield, cybercrime-fighter startup Damballa, Digital Shadows, ThreatStream and others.
“Distributed ledger technology, including blockchain, has huge potential to deliver cost savings and new ways of working across the global banking industry – but most blockchain applications today are still in the proof of concept stage,” said Mariano Belinky, Managing Partner of Santander InnoVentures.
Elliptic was co-founded in 2013 by CEO Dr. James Smith, COO Dr. Tom Robinson, and Chief Scientist Dr. Adam Joyce. They are expanding their current team of nine employees.