Crypto Recovery Specialist Asset Reality Raises $4.91M to Hire Engineers, Expand Ops
The irreversibility of cryptocurrency transactions presents a unique challenge for recovering stolen assets. The seed funding round was led by Framework Ventures and other investors.
London-based Asset Reality has raised $4.91 million in seed money to build a full service solution for crypto asset recovery, according to a press release provided exclusively to CoinDesk.
The fundraising was led by Framework Ventures, TechStars, SGH Capital and Outrun Ventures' Chris Adelsbach. The company plans to use the funds to triple its engineering staff and expand operations.
Traditional asset recovery has existed for decades; but the decentralized nature and irreversibility of cryptocurrency transactions presents a unique challenge. Asset Reality believes it can solve that conundrum by building a one-stop shop for tracking and recovering stolen digital assets.
“The existing asset recovery system only recovers about 1% of criminal proceeds globally, with the emergence of digital assets adding more complexity to those efforts,” Asset Reality CEO and co-founder Aidan Larkin said in the release.
According to blockchain security firm Certik, 2022 was crypto’s worst year in terms of hacks, scams and attacks. The industry lost a staggering $3.7 billion to illicit activity.
To add insult to injury, 2023 kicked off with a hack that sent shock waves through Crypto Twitter when longtime Bitcoin Core developer Luke Dash Jr. tweeted that hackers had compromised his hot and cold wallets on New Year’s Day and siphoned off over 200 bitcoin (BTC).
Dash later tagged the FBI in a follow-up tweet, although it’s unclear if law enforcement ever got involved. Binance CEO Changpeng Zhao (also known as CZ) was quick to offer his assistance.
“Not everyone is a developer who can get CZ's attention, and this is why we exist,” Larkin told CoinDesk in an interview. “If someone like that comes on to the platform, we're taking the data about the loss that they've incurred and we're broadcasting that through our partners and through the analytics tools. So the first action is to do exactly what CZ mentioned.”
Per the release, the Asset Reality team has specific experience with crypto asset recovery including “managing and liquidating” bitcoin in the aftermath of the epic Silk Road case. More recently, the company has delved into all manner of digital assets.
“We manage seized [non-fungible tokens] for the Belgian government, for example,” Larkin said. “They will be sold by auction when the court order is granted, if the person is found guilty.”
Larkin envisions a future where stolen crypto will be easily restored just as stolen credit card funds are routinely restored today.
“Asset Reality has a team of ex-law enforcement and private sector asset recovery practitioners. We've investigated, we've seized, we've recovered, we've been to court,” Larkin explained. “So it's trying to fill that big gap that currently exists where you've got best practices, you've got good tools, but everything just isn't gelling together. That’s where we slot in.”
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2024, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.