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Blockchain startup Elliptic to help curb Bitcoin drug trafficking with new partnership

London blockchain security experts Elliptic have announced a new partnership that it claims will bring bank-grade’ money-laundering controls to Bitcoin transactions in an attempt to curb the more nefarious uses for the digital currency.

The FinTech firm has joined forces with US risk management firm LexisNexis in a data sharing arrangement that aims to make Bitcoin a more attractive proposition for those wishing to put the cryptocurrency to more legitimate uses.

As part of a suite of anti-money laundering services, LexisNexis maintains a database of 2.7m entities worldwide, including individuals on watch lists or currently under sanctions, who may be involved in illicit transaction.

Elliptic will now be able to cross-reference its blockchain monitoring activities with the New York firm’s database in an effort to clamp down on the currency’s more nefarious uses such as drug trafficking and money-laundering.

Speaking to Reuters, Thomas Brown, of LexisNexis Risk Solutions said that the partnership is ‘a step towards making it (bitcoin) more mainstream and more acceptable’.

Bitcoin and blockchain technology has long been touted for its potential in financial services, with major banks looking at ways to implement blockchain and cryptocurrency tech into their current operations.

However, the reputation and crossover appeal of Bitcoin in particular has been hampered due to its widespread use by criminals and other nefarious individuals for illegal activity online and elsewhere.

As Elliptic’s Head of Business Development, Kevin Beardsley explained: “The single biggest thing keeping mainstream financial services out of the (bitcoin) ecosystem is the inability to do bank-grade anti-money laundering controls.

“The hope is that this will unlock a whole wave of companies being able to enter financial services with bitcoin.”

Elliptic closed a £3.48m Series A funding round March and have made great strides in legitimising blockchain technology and Bitcoin for mainstream uses through their machine learning systems that attempt to root out illicit transactions.