Due to the anonymity that virtual currencies offer, a market has emerged for forensic services that uncover who is using these digital coins. One of the companies offering this kind of blockchain forensics service is Chainanalysis, which was co-founded by Jonathan Levin, the current chief operating officer of the company.
Initially Chainanalysis would monitor cryptocurrency transactions at the behest of the United States government investigators on the hunt for money launderers, fraudsters and other shadowy types. Now the blockchain forensics firm has expanded its client base and counts financial institutions as its customers.
Series A fundraising round
Recently Chainanalysis announced that it had raised approximately $16 million in a Series A round which was led by Benchmark, a venture capital firm that was an early investor in the likes of Uber and eBay and which has been following digital currencies since 2014. Four years ago Benchmark made an investment in Xapo, a Bitcoin storage startup. Benchmark also participated in co-launching a Bitcoin investment fund.
In its early years the Chainanalysis software was a reactive program which was largely reliant on human beings to make the connections between the various Bitcoin accounts. This could then be used to follow the money in a bid to uncover criminals who were making the digital currency transactions. However progress has been made and now it is mostly automated and can make decisions regarding the risk that individual Bitcoin accounts pose by analyzing their history of transactions. This way businesses which are dealing in digital coins are in a position of telling that the users they are transacting with are legitimate or are crooks or money launderers.
Know Your Transaction
One of the new features of Chainanalysis is a Know Your Transaction product and it is used in screening suspicious activity in digital wallets in real-time. Thus someone who is receiving funds can decide on the fly whether to accept to process or decline to process the transaction in real-time.
The software that Chainanalysis has developed has been used by major law enforcement agencies across the globe. This includes the Dutch police who disclosed last month that they used the software of the blockchain forensics firm to track down Hansa, one of the largest dark web narcotics marketplaces in the world. Chainanalysis? software was also instrumental in assisting Mt. Gox?s creditors track down coins numbering 650,000 which went missing in 2014.
Other blockchain forensics companies
Besides Chainanalysis there are other blockchain forensics and monitoring firms and they are promising to guarantee trust in virtual currencies such as Bitcoin (BTC) by monitoring the various blockchain networks that exist.
Chainanalysis? biggest rival is Elliptic which raised approximately $5 million two years ago in a Series A round. Last year Elliptic also raised another round but did not disclose how much was netted. Among the participants in that round were SignalFire, a venture capital firm based in San Francisco, California.
Due to an anticipated demand for its services from law enforcement agencies such as the Drugs Enforcement Agency and the FBI, Elliptic intends to increase the number of its employees from 25 to 50 this year.
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Bitcoin to Surpass $20,000 ATH By Early 2021 According to Raul Pal
Former hedge fund manager and CEO of Real Vision, Raoul Pal, believes that the real impact of the COVID-19 pandemic is about to reach the financial markets. By outlining several upcoming cornerstones among traditional financial assets, he highlighted Bitcoin as the “life raft” in this situation.
Raoul Pal: Everything Has Changed
In a recent Twitter thread, the Wall Street veteran outlined the rapidly growing COVID-19 cases worldwide. The total number of infected has neared 45 million, while the death toll is almost 1,2 million.
Pal predicted that these rising numbers in Europe, the US, and Canada are about to “exert economic pressures and extinguish the Hope phase of reflation dreams.” He believes that the upcoming consequences will harm the economy even more than the early 2020 developments. A real economic recovery “will take more than a post-election stimulus in January.”
He continued by looking at several markets that have started to feel the adverse consequences and have fallen to long-term support levels. Those included the oil price, Spain’s benchmark stock market index – the IBEX 35, the EU Banks Index, the euro, the British pound, the US dollar, and more.
As such, he broached a few possible solutions – “you can buy bonds and dollars, or you can take the life raft – Bitcoin.”
“Or, to dampen the volatility of a risk-off event (we can and will see sharp BTC corrections), you can have all three for a near-perfect portfolio for this phase.” – Pal concluded.
Bitcoin Will Eat The World And Price Predictions From Pal
Pal further highlighted his positive views on Bitcoin by saying the cryptocurrency “will eat the world.” He attributed it to its performance, which is so dominant and so “all-encompassing” that it will “suck in every single asset narrative dry and spit it out.”
“Never before in my career have I seen a trade so dominant that holding any other assets makes almost no sense.”
As far as price predictions go, Pal said that $14,000 is the only resistance left in Bitcoin’s way to the all-time high at $20,000. He expects that BTC should overcome the December 2017 high by “early next year at the latest.”
Additionally, CryptoPotato recently reported an even more optimistic and long-term forecast. By using a regression on the logarithmic chart since inception, Pal brought up a model that sees Bitcoin reaching $1 million by 2025.
Featured Image Courtesy of BusinessInsider
Coinbase Launches A Crypto Debit Card With 1% Reward on Bitcoin Spendings
- The largest US-based cryptocurrency exchange Coinbase announced today the launch of a Visa debit card, allowing customers to spend digital assets for everyday purchases.
- According to the official statement, the Coinbase Card will provide clients the opportunity to earn up to 4% back in cryptocurrency rewards.
- It will be available in nearly 30 countries, including the US, the UK, and across Europe. It will be connected to customers’ Coinbase accounts, and they can spend the funds without having to move funds to their bank accounts.
- The designated cryptocurrency asset spent by users will be automatically converted to US dollars prior to completing the purchase or the ATM withdrawal.
- The rewards will be available for US-based customers only initially and will depend on the cryptocurrency used. For instance, customers can get 1% back if they spend bitcoins and 4% back if they choose Stellar Lumens (XLM).
- The Coinbase app will serve as a fund manager. All spendings, reward details, and preferences will be manageable through the app.
- US customers can start applying to receive the card through the exchange’s app or the website. The first approved clients will be announced “this winter,” and they can start spending with a virtual card. The physical one will be delivered within two weeks.
Bitcoin-Friendly Avanti Receives License to be The Second Crypto Bank in The US
Now the United States can boast a new crypto bank: Welcome Avanti.
Avanti Financial Group, a firm founded by the former managing director at Morgan Stanley, Caitlin Long, announced that it had been granted a license to offer banking services by the Wyoming State Banking Board.
Avanti is The Second Crypto-bank Operating in the United States
With this decision, Avanti becomes the second crypto company to receive a banking license after the crypto exchange Kraken was also authorized by the Wyoming State Banking Board.
This license allows Avanti to offer financial services in the same way that a traditional bank would, only that these are in addition to the crypto services already provided by the platform.
According to Avanti, the application in the state of Wyoming was key to meeting its expectations —just like Kraken did— as it is the only state in the country that has a regulator with a bank supervisory and regulatory program for digital assets mature enough to ensure the operations of a banking platform that offers risk-free custody services.
Currently the only type of U.S. financial institution that can provide final and simultaneous settlement of trades between digital assets and the U.S. dollar-because it is the only type currently approved to handle both within the same legal entity-is a Wyoming special purpose depository institution like Avanti.
Blockchain and Banking Working Together
Avanti said in a tweet that the first crypto product the company will launch will be a stablecoin pegged to the dollar and backed by physical deposits made to its bank accounts. The token will be called Avit and will be available for its customers in the first quarter of 2021.
AVANTI IS OFFICIALLY A BANK! Our charter & business plan were approved 8-0 today, incl. #Avit (a tokenized US dollar, which we announced we’ll issue initially on #Liquid (#Bitcoin sidechain) & #Ethereum. Open for commercial customers early Q1. More here:https://t.co/CgNazN08zV
— Avanti Bank & Trust (@AvantiBT) October 28, 2020
Avanti revealed that Avit tokens will run on Ethereum – a critical blockchain for those seeking to take advantage of programmable smart contracts – and Liquid – a Bitcoin sidechain developed by Blockstream for those seeking to benefit from inter-exchange transfers for arbitrage operations.
Avanti had previously confirmed its collaboration with Blockstream to develop this token, explaining that it would not be like a normal crypto-currency and that it would be “just bank money that happens to be issued on a blockchain.” So it may look more like JPM Coin than the famous USDT.
Caitlin Long promised that Avanti “will provide products and services that do not exist in the market today. They did not refer to what they had in mind, so we can only hope.
There has been a lot of activity around cryptocurrency and financial services with blockchain technology in the United States. After MicroStrategy announced a major investment in Bitcoin, Square revealed a $50 million investment in BTC. Also, PayPal started providing support for cryptocurrencies and JP Morgan started using its own cryptocurrency commercially days after it talked about Bitcoin’s potential to triple its price.
Most of these announcements helped boosting BTC’s price. Will this have a bullish effect too?
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