Blockchain analytics company Chainalysis announced Monday that it has acquired fraud detection startup Alterya. The deal was worth $150 million, according to Business Insider.
Chainalysis, the largest company tracking illicit crypto flows on behalf of financial institutions and governments, plans to strengthen its anti-scam capabilities with Alterya, CEO Jonathan Levin told CoinDesk.
Both companies are tackling a thematically similar problem – blockchain bad actors – from different positions. Chainalysis brings together a wealth of information about crypto wallets to trace where money is flowing. Alterya, on the other hand, uses data on fraudsters to cancel their transactions mid-process.
“Alterya has collected the most comprehensive set of information that exists on the entire financial infrastructure of fraudsters,” Levin said. Exchanges that connect to its data set can flag transactions initiated by potential victims, stopping crime before it happens.
Chainalysis already collects tons 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 longer list than Chainalysis. By combining the capabilities of both companies, he hopes to detect even more scammers.
The acquisition continues Chainalysis’s poaching of Israel-based crypto security startups, following its acquisition of Hexagate last month. All teams will work in a new combined office in Tel Aviv, Levin said. This could position the company well to further tap into what he calls Israel’s “very important talent market for this type of work.”
Although Chainalysis is best known for its work in the cryptospace, it is now shifting its focus to combating financial fraud more broadly. Alterya’s AI-based fraud models offer “substantial opportunities in the traditional market,” Levin said, and have the data needed to help banks and other financial institutions stop fraud.
