CipherTrace Says It Can Instantly Flag Shady Transactions With Predictive Risk Scores

The blockchain analytics firm claims its new system respects crypto users’ privacy while also flagging suspect transactions.

AccessTimeIconJul 21, 2020 at 1:00 p.m. UTC
Updated Sep 14, 2021 at 9:33 a.m. UTC
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CipherTrace, a blockchain analytics software firm, has deployed a predictive risk-scoring system the company says provides real-time alerts on suspect crypto transactions for its exchange, investor and investigator clients.

  • The tool will assign risk based on the on-chain histories of transacted funds, the Silicon Valley firm said.
  • Inbound cryptos with unseemly ties (from sanctioned countries or a fraud campaign, for example) would get a “high risk" score under the system.
  • CipherTrace claims the score respects user privacy, saying in a press release that it does not process any personally identifiable information. 
  • Coming days after a Twitter hacker scammed nearly $200,000 in bitcoin from hundreds of victims, the score could warn exchanges of incoming plunder, CipherTrace chief financial analyst John Jefferies told CoinDesk.
  • All CipherTrace clients can use the tool from Tuesday's launch at 13:00 UTC (9 a.m. ET).
  • Jefferies declined to state how large that customer base is, saying only that Binance is among them. CipherTrace firm has previously boasted 150 partners. 
  • The blockchain intelligence sector is broadly deploying risk-based scoring against a problematic crypto trio: money launderers, sanctions violators and terrorist financiers.
  • CipherTrace competitors Chainalysis and Elliptic market similar tools.


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