The blockchain analytics firm launched Chainalysis Government Solutions, a subsidiary focused on helping US government agencies investigate crypto-related crimes. According to the firm’s latest research, 75% of public sector agencies globally are unprepared to address crypto incidents, demonstrating a growing need for relevant resources and technologies available to investigators.

Government companies

After reaching settlements with the US government worth tens of millions, Chainalysis has redoubled its efforts to support public agencies’ crypto investigations by providing advanced technology and data tools to track blockchain transactions.

In 2020, the firm signed a $625K contract with the IRS to develop a tool to track privacy coins like Monero and second layer solutions like the Lightning Network, as the authority aimed to detect and track illicit crypto transactions.

Chainalysis’s latest blog post outlined four main solutions that the team will offer to US agencies. In particular, the firm will integrate “best-in-industry software data and tools” and on-chain analytics to provide insights to government agencies.

With the notable increase in crypto crime in recent years, crypto investigations by governments have extended far beyond the use of bitcoin in illicit markets, and have even targeted areas of ransomware attacks, nation-state hacking, and more, said Chainalysis CEO Michael Gronager.

The firm also hinted that, due to the newly added division, its total headcount could double from its current size of 110 employees, including 90 forensic investigators, in the next six to twelve months. The analytics giant reached a valuation of $8.6 billion after raising $170 million in May.

public agencies

The new government-focused subsidiary takes shape against the backdrop that 74% of public agency employees said their organization is not well-equipped to investigate crypto-related crimes, according to a recent survey conducted by the firm.

Furthermore, with the rise of DeFi activity, which is more difficult for investigators to investigate, many public agencies did not adopt specialized blockchain analytical tools for relevant investigations.

Chainalysis surveyed 300 respondents across 183 public sector agencies in the United States and Canada while trying to dive deep into public sector crypto investigations. The report found that the most frequently investigated crypto-related crimes center around scams, fraud, drugs, cybercrime, and ransomware.

On average, respondents rated their understanding of cryptocurrencies at 58, on a scale of 0 to 100, from completely unaware to extremely knowledgeable. Crypto education is also needed in the public sector. Therefore, better tools and relevant support for public agency employees to monitor, track, and investigate cryptocurrency-related cases are in short supply, the report concluded.

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This post Chainalysis Launches Government-Focused Team Offering Solutions for Crypto Crimes

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