Banks Look At Elliptic To Remove Blockchain Anonymity

Banks and other established players in the financial market are closely exploring the use cases for blockchain technology. As a result of this increased interest, there is a growing demand for blockchain service providers such as Elliptic. In fact, banks are willing to throw a lot of money at these types of companies, rather than to try to develop their blockchain based solution in-house from scratch. Although Elliptic has raised a whopping US$5m in funding recently, there is still a long way to go before blockchain technology will meet the legacy system.

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Elliptic Could Be The Missing Link

That seems to be the conclusion by various banks around the world, as the recent round of investments in Elliptic is mostly a result of growing interest in blockchain by banks and other big financial players. Paladin Capital led this round of funding and was joined by Santander along with Octopus Ventures.

Elliptic is among several other companies active in the Bitcoin world which provide blockchain-based services and solutions. Their brand butter is identifying Bitcoin transactions on the network which could be suspicious, and further strip away the last remaining shreds of the illusionary anonymity associated with Bitcoin itself.

Government officials and executive financial players have always been wary of Bitcoin and its alleged anonymity even though the perceived anonymity is not present in the digital currency’s ecosystem at all. While it is somewhat difficult to link an identity to a particular wallet address at a glance, it has always been possible to trace transfers. Moreover as soon as someone tries to cash out their Bitcoin, there will be an eventual need for an identity verification.

On the other side, the technology underpinning the Bitcoin ecosystem could have various use cases in traditional finance as well. Although the blockchain was designed to respect user privacy rather than provide anonymity, financial players have a hard time embracing this technology if they want to root out suspicious transactions in the future.

Elliptic could be the missing link to solving this problem as the startup uses artificial technology to scan the Bitcoin network, which should make it easier to distinguish between legitimate and suspicious transactions. Moreover, the outcome of these actions should make it easier for financial players to trace the suspicious transaction back to its source.

Now that the company has raised another US$5m in funding, they can look to the future and expand their New York office, as well as try to attract more banks in the future. No further details were announced at this time, although it is positive to see this growing interest in removing the myth of blockchain anonymity from the equation.

Source: Telegraph UK

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