Blockchain analytics company Chainalysis said On Monday it acquired fraud detection startup Alterya. The deal carried a price tag of $150 million, according to Business Insider.
Chainalysis, the largest company that monitors illicit crypto flows on behalf of financial institutions and governments, plans to bolster its scam-stopping capabilities with Alterya, CEO Jonathan Levin told CoinDesk.
The two companies are attacking a similar subject problem – bad actors on the blockchain – from different positions. Chainalysis gathers troves of intel on crypto wallets to track where money moves. Alterya, meanwhile, uses data on scammers to destroy their transactions mid-route.
“Alterya has collected the most comprehensive set of information about all of the scammers’ financial infrastructure out there,” Levin said. Exchanges plugged into its dataset can flag transactions initiated by potential victims, stopping crime before it happens.
Chainalysis already collects a lot of data about crypto scammers, and there is significant overlap between its in-house blacklist and Alterya’s, Levin said. But the startup has a bigger list than Chainalysis. By combining the capabilities of the two companies, he hopes to sniff out more scammers.
The acquisition continues Chainalysis’ poaching of Israeli-based crypto security startups, following the buyout of Hexagate last month. All teams will work in a new, joint office in Tel Aviv, Levin said. That could position the company well to further tap what he calls Israel’s “very deep talent market for this type of work.”
While Chainalysis is best known for its work in the cryptospace, it is now taking action to combat financial fraud more broadly. Alterya’s AI-driven fraud models have a “huge opportunity in the traditional market,” Levin said, and the necessary data to help banks and other financial institutions stop fraud.
