Blockchain intelligence firm Elliptic has completed a $5 million Series A round led by Paladin Capital Group. Santander InnoVentures, KRW Schindler, Digital Currency Group, and existing investor, Octopus Ventures also participated. Paladin managing director Christopher Steed joins Elliptic’s board while Santander received observer status.
Funds are earmarked toward technology enhancement.
From its New York and London bases, Elliptic employs graph analysis and machine learning to identify illicit activity in blockchain transactions, positioning itself in an ideal spot as more organizations employ blockchain technology.
Since its 2013 debut Elliptic technology has been used on more than $2 billion in Bitcoin transactions. The company has also assisted American and European law enforcement by providing evidence on such crimes as international arms trafficking, drug sales, extortion, theft and money laundering, the company said in a release.
Paladin Capital Managing Director Kenneth Minihan explained his firm’s interest in Elliptic.
“Elliptic has demonstrated a powerful working product that can combat illicit activity on blockchains. Elliptic is a game-changer for blockchain and is already trusted by some of the smartest minds in law enforcement and compliance.
“We recognize the firm’s monitoring capability will be an essential component of any blockchain in the future and we will help Elliptic to expand in the US, via our contacts and knowledge of US law enforcement and government agencies.”
Distributed ledger technology has several advantages, Santander InnoVentures Managing Partner Mariano Belinky said.
“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.
“For distributed ledger technology to achieve widespread use, compliance departments and regulators will demand independent monitoring capabilities to combat insider trading, fraud, and money laundering. Elliptic is an authority in this area.”
Elliptic CEO and Co-Founder Dr. James Smith said the new partners have already helped the company’s growth.
“Over the last three years we have built a top-tier client base. Our new investors bring deep expertise in law enforcement, international financial services, and blockchain technology and we are excited to work with them on our next phase of growth. We have already been able to expand operations to the US and will continue to extend our portfolio of products.”