Cryptocurrencies security firm wins multi-million dollar investment

Nigel Frith
bitcoins on a table

A crypto and blockchain security firm known for releasing incisive reports into fraud in the crypto markets has announced it has secured $15 million in investment.

CipherTrace, which was set up in 2015 and counts a number of cryptocurrency experts among its staff members, offers a wide variety of services including blockchain threat intelligence, tools to tackle money laundering, and more.

Its client list is extensive and is believed to cover everyone from regulators and banks to investigators and crypto exchanges.

The new venture capital investment round came from a number of institutions.

It will be led by Aspect Ventures, and a representative of that organisation – Mark Kraynak – will move on to the board of directors of CipherTrace.

Other organisations involved in the investment round include Neotribe Ventures, Galaxy Digital and WestWave Capital.

David Jevans, who is CipherTrace’s CEO, struck a positive note and said that the other organisations involved “share our vision”.

“CipherTrace is pleased to announce this strong backing from top-tier investors who share our vision that cryptocurrencies and blockchains need to be secured, regulated, and made safe so that they can scale globally”, he said.

“Our investors have decades of experience investing in proven teams and technology companies in the Internet security and financial technology industries. CipherTrace will join the ranks of these successful companies”. he added.

New director Mark Kraynak said that “security and compliance” were a “key first hurdle” to overcome.

“Great blockchain companies will be forged as crypto assets achieve mainstream adoption. We believe security and compliance with anti-money laundering and other financial regulations, as enabled by CipherTrace, will be a key first hurdle to mass adoption”, he said.

This investment is not the first time that the firm has been supported by high profile organisations, however.

When it was first launched, it received funding from organisations such as the US Department of Homeland Security’s Science and Technology (S&T) group.

Perhaps CipherTrace’s most famous output, at least to followers of the crypto press, is its reporting.

Earlier this year, for example, CipherTrace was responsible for the report that discovered over $950 million US dollars had been taken by crypto hackers in the year 2018 – plus at least another $725 million which was taken in related scams such as ICO fraud.

The report also looked in detail at what exactly was behind crypto fraud – and how criminals were getting around the safeguards put in place.

It claimed that tools such as unregulated crypto-to-exchanges and so-called privacy coins were just two of the tools being used by crypto scammers.

It also looked at some of the major overarching trends in crypto scam threats.

It explored the world of SIM swapping, a common trend which sees a person’s mobile phone identity overtaken by a criminal in order to authorise illicit crypto transactions.

It also looked at what it called datacentre-scale cryptojacking, which sees legitimate datacentres, such as that of Amazon Web Services, used for nefarious purposes by cybercriminals breaking into the organisation.

 


Nigel Frith

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