Monday, February 10, 2025
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Following ours the recently announced Binance partnershipjoined by Elliptic co-founder and chief scientist Tom Robinson Cheddar to discuss the details of the partnership and how our blockchain monitoring capabilities enable banks to confidently work with crypto exchanges.

The collaboration signifies a shared commitment to fighting cryptocurrency-enabled crime and tracking illegal activity on the blockchain. Binance is an innovative global cryptocurrency exchange and the new partnership enhances its compliance and anti-money laundering (AML) capabilities.

Watch the full video to hear how our leading transaction tracking software will help Binance overcome key challenges of the crypto industry.

transcript:

Cheddar Anchor 1: With us now is Tom Robinson, Chief Scientist and Co-Founder of Elliptic. Before we get into the details of the partnership, for those who may not be familiar, what is Elliptic and how does it work?

Tom Robinson: So, Elliptic provides products and services to help our customers prevent cryptocurrency money laundering. So bitcoin is an incredibly powerful payment mechanism. In addition to being used for completely legitimate purposes, it is also sometimes used by criminals, which is how we help our clients detect when a transaction is related to criminal activity.

Cheddar Anchor 2: And why is a company like Binance such an important partner for you?

Tom Robinson: So, Binance is one of the leaders in our industry with a huge number of clients around the world. So it’s a great validation for our products, but it’s also important because they’re really one of the most innovative players. The types of services, the types of assets that they list are really at the cutting edge and that’s useful for us because we have to stay up to date and make sure that our offering meets these cutting edge requirements.

Cheddar Anchor 1: Is it a big challenge for you? I mean Binance is huge. It is one of the largest and one of the most popular stock exchanges globally. What does that mean for you in terms of additional resources, if anything?

Tom Robinson: We already work with most of the big players in the industry. So scale is not an issue for us. Each stock market has slightly different requirements. They list slightly different coins and assets and that’s always a challenge. We need to make sure we have coverage for all the most popular properties, but it’s something we’re always ahead of.

Cheddar Anchor 2: As the use of cryptocurrency increases, so does the risk of end-of-day hacks. CipherTrace also releases its Cryptocurrency Anti-Money Laundering Report for the first quarter of 2019 and finds that exchanges worldwide have lost nearly $400 million as a result of hacks and thefts.

Tom Robinson: Yes.

Cheddar Anchor 2: As we see more usage, how do you preempt the unknown, the different ways that hackers will try to attack these exchanges?

Tom Robinson: So I think there will always be hacks. I think the way you deal with that is to make it harder for hackers to launder the proceeds of those crimes. You make it so that it is very difficult for them to convert those stolen crypto assets back to fiat. And the way you do that is by using a product like ours. So if we see that a particular wallet has received stolen funds from the exchange, we will mark it as such. And that means that if the exchange receives the funds from those wallets, they will know that they came from theft.

Cheddar Anchor 1: Today I talk a lot about de-risking banks. What role do companies like Elliptic play, as well as its peers like Chainalysis and some newer players like LUKA or Digital Assets Data. What role do you play in reducing that problem, if any? Because you’re looking at all this data, you’re looking for that illicit activity that’s so risky for the banks and that might be a little overstated in the media, but it certainly happens.

Tom Robinson: It’s definitely overrated. And part of what we’re doing is trying to educate the banks on the scale of this problem, put it in the context of the overall activity within cryptocurrencies, but also educate them on what’s possible in terms of overcoming these compliance challenges, in terms of monitoring blockchain, in terms of what exchanges cryptocurrencies work and their compliance programs to mitigate these risks. Banks are also our clients. We’re actually selling them software so we can track what’s going on in the blockchain and that helps them become a lot more comfortable with what’s going on in these exchanges.

Cheddar Anchor 2: What is the biggest challenge right now besides illegal activities?

Tom Robinson: I think that banking issue is a big one. I think we have a traditional financial system, we have this new open financial system that is enabled by cryptocurrencies and where they converge, where they merge, there is friction. So it’s extremely difficult for a cryptocurrency exchange to maintain a banking relationship, so we’re working really hard to solve that problem and help exchanges work with banks.

Cheddar Anchor 1: Awesome. Thanks a lot, Tom. Congratulations on your new partnership with Binance. That’s huge.

Tom Robinson: Thanks for having me.

Interested in learning more about how Elliptic helps banks and exchanges with AML compliance?

Contact us

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