Blockchain analytics firm Chainalysis said Monday it had acquired fraud detection startup Alterya. According to Business Insider, the deal carried a price tag of $150 million.
Chainalysis, the largest company that tracks illicit crypto flows on behalf of financial institutions and governments, plans to strengthen its scam-stopping capabilities with Alterya, CEO Jonathan Levin told CoinDesk.
The two companies are attacking a thematically similar problem – bad actors on the blockchain – from different positions. Chainalysis gathers lots of information about crypto wallets to track where the money moves. Alterya, meanwhile, uses data on fraudsters to remove their transactions midway.
“Alterya has assembled the most comprehensive set of information about all the fraudsters’ financial infrastructure out there,” Levin said. Exchanges that plug into its dataset can flag transactions initiated by potential victims and stop the crime before it happens.
Chainalysis already collects volumes of data on crypto fraudsters, and there is significant overlap between its internal blacklist and Alterya’s, Levin said. But the startup has an even bigger list than Chainalysis. By combining the two companies’ capacities, he expects to sniff out even more fraudsters.
The acquisition continues Chainalysis’ poaching of Israeli-based crypto-security startups following last month’s acquisition of Hexagate. All teams will work out of a new, combined office in Tel Aviv, Levin said. That could position the company well to further tap into what he called Israel’s “very deep talent market for this kind of work.”
While Chainalysis is best known for its work in the crypto space, it is now moving to fight financial fraud more broadly. Alterya’s AI-powered fraud models have “significant opportunities in the traditional market,” Levin said, and the data needed to help banks and other financial institutions stop fraud.
