Professional services giant and ‘Big Four’ accounting firm Deloitte is joining blockchain data platform Chainalysis in a strategic alliance to provide digital asset analytics services to the organizations’ mutual clients.
According to a press release, Chainalysis will support the blockchain and digital assets team at Deloitte, covering risk assessment, enforcement of regulatory compliance (including KYC and AML), data analytics to identify targets and trace the flow of funds, and investigations creating target profiles by fusing data points.
Deloitte meanwhile, will increase the number of its staff members who are trained and certified in the use of Chainalysis analytical tools.
The companies claim that, as blockchain technologies and digital assets become more ingrained into the mainstream financial conversation, there is an increasing market demand for technology-based risk management solutions and services.
The strategic alliance is initially looking to law enforcement agencies, regulators and financial institutions. Chainalysis president and chief revenue officer, Thomas Stanley, explained that it could offer these institutions, “new, collaborative solutions that help identify transformation gaps, accelerate mission success at enterprise scale, and mitigate risk while increasing revenue.”
The alliance has reportedly been planned for some years, with one aim being to increase organizations’ adoption of blockchain technology. The services will initially be rolled out in the U.S. but Stanley said that they can be readily adopted by other markets.
In an overview pdf aimed at government and public services agencies, Deloitte lists challenges such as the misuse of cryptocurrency to obfuscate transactions and launder funds, inconsistent international regulations, unclear domestic (United States) regulations, and an ever-changing landscape of new coins and tokens.
Through investigating obfuscation techniques (such as chain-hopping, mixers and DeFi use), money flow from fiat to crypto to fiat, and the illicit use of NFTs and stablecoins, the company claims it can, “Help law enforcement identify the actors behind the keyboard, effectively prosecute them, and seize their illicitly obtained assets.”
Chainalysis data insights are claimed to connect over a billion addresses to real-life entities on both sides of the law: from illicit services such as those we Observed in its recent mid-year crypto crime update, to legitimate services such as retail, DeFi platforms and mining pools.
Its investigation tools can then create clear maps of fund movements across smart contracts, flash loans, cross-chain and DeFi protocols, revealing patterns and insights to help investigations and risk assessments.
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