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Elliptic published its 2024 typologies report on the nexus between crypto-assets and financial crime. This year's report is designed to equip compliance teams and law enforcement with the practical insights needed to continue to detect new financial crime risks with success. The report includes case studies and insights on the convergence of AI and crypto-assets and how it is impacting criminal activity, the increasing use of stablecoins in financial crime typologies including pig butchering scams and sanctions evasion activity, and major law enforcement and regulatory actions with additional case studies.

Moody's and Elliptic have formed a strategic alliance to integrate on-chain blockchain data with traditional off-chain data sources to screen virtual asset service providers (VASPs). The solution leverages Elliptic's real-time on-chain data, which categorizes the exposure of digital asset transactions to illicit activity and combines this with Moody's off-chain data within an integrated risk engine. Together, it provides a comprehensive overview of a VASP, helping institutions understand who they are doing business with and the associated risk.

"Crypto stolen from the massive $1.4 billion hack of the Bybit crypto exchange is likely to be laundered through mixers as the hackers continue to attempt to obfuscate the transaction trail. If previous laundering patterns are followed, we might expect to see the use of mixers next, reported blockchain security firm Elliptic, which attributed the theft to North Korea's Lazarus Group. However, this may prove challenging due to the sheer volume of stolen assets."

Iran is using Bitcoin mining to circumvent and lessen the effect of the economic sanctions that the U.S. and other countries have applied to the country since 2006, according to a new study by Elliptic. The country is indirectly using bitcoin mining to export part of its energy reserves, whose exports are being hampered by the said sanctions.

Researchers have calculated that it would require 13 × 106 physical qubits to break the Bitcoin network's 256-bit elliptic curve key encryption within one day. In other words, no time soon because IBM's largest superconducting quantum computer is just 127 physical qubits.

Elliptic published the 2024 edition of its global crypto regulation landscape review, highlighting key trends and regional developments that are shaping the future of regulatory compliance. Significant developments have emerged across three key areas: the EU's Markets in Crypto-assets (MiCA) regulation, the expansion of the "travel rule" to crypto transactions, and stablecoin regulation. Authorities are now emphasizing consumer protection, financial stability, and preventing illicit activities, aided by the entry of mature institutional players, contributing to a structured and transparent market.

"Elliptic has attributed the Bybit theft to North Korea's Lazarus Group, based on various factors, including our analysis of the laundering of the stolen cryptoassets. North Korea-linked actors have stolen over $6 billion in cryptoassets since 2017, with the proceeds reportedly spent on the country's ballistic missile program."

What if governments concede that it's both impossible and unnecessary to formally identify poor people at the on and off-ramps? What if they accepted an AML model that treats the endpoints as unidentified nodes and, drawing on these new analytic tools, actively managed access to networks based on behavior not identity? Here, ongoing research in machine learning and high-performance computing by the MIT-IBM Watson AI Lab in collaboration with Elliptic could be a catalyst.

Elliptic collaborated with MIT-IBM Watson AI Lab researchers using machine learning software to analyze 203,769 bitcoin node transactions worth roughly $6 billion in total. They found that only 2% of the 200,000 bitcoin transactions in the data set were deemed illicit, although roughly 77 percent remained unclassified.

The Libra Association is thinking of radical approaches to reach the unbanked in certain locations, including a "step-ladder" approach to KYC regulations. The FATF said it is open to working with Libra about potentially building new forms of digital identity. Libra believes blockchain forensics firms like Chainalysis, Elliptic and Coinfirm will help strengthen the case for "tiered KYC" by monitoring wallet profiles and transaction histories. Non-profits in the Libra Association like the Kiva Foundation may play a key role.

After two years of laying the groundwork, crypto-friendly Arival Bank is launching in beta. With a team of 20 with offices in Singapore, Puerto Rico and Saint Petersburg, Fla., it plans to provide banking accounts to crypto startups via its sponsor bank, Puerto Rico-based San Juan Mercantile Bank and Trust. But to bank with Aival clients have to show what's in their wallet, because Arival is using tools from Elliptic to scan the crypto addresses that onboarding clients provide and see if there are any suspicious transactions.

Blockchain analytic firm Elliptic has found that the proportion of Bitcoin (BTC) transactions linked to criminal activity is way down. However, as a result of heightened know your customer (KYC) requirements, exchanges have lost ground as a destination for illegal crypto and the use of privacy wallets has increased.

On November 14 the Taproot Bitcoin upgrade activated, opening the door for developers to integrate new features that will improve privacy, scalability and security on the network. At the root of the upgrade is the switch from elliptic curve digital signature algorithm (ECDSA) to Schnorr digital signatures. In addition to being smaller and faster that ECDSA, Schnorr signatures have the added benefit of being linear, a combination that will boost Bitcoin's transaction privacy and allow for more lightweight and complex smart contracts.

It is important to rely on preventive measures that reduce the scale of double-spending attacks on offline payment platforms. An example of such a measure is secure elements. These however are limited in compute and storage, making the design of solutions that offer comparable privacy guarantees to those of physical cash challenging. We address this with a protocol that offloads most of the payment computation to the user's mobile device and restricts the computation on the secure element to deleting spent tokens, and generating a signature with a computation equivalent to that of elliptic curve digital signature algorithms (ECDSA). We claim that the use of mobile devices or enhanced smart card-based devices are required for secure consumer-to-consumer payments. To further harden the protocol, we enable the efficient identification of double spenders on the off-chance an attacker successfully double spends. Finally, we prove its security in the ideal/real world paradigm, and evaluate its performance to demonstrate its practicality. We use Pedersen commitments to allow one to commit to a vector of messages m without leaking any information about the committed vector.