CipherTrace Unveils New Crypto Tracing Tool For Banks

Crypto investigation company CipherTrace has unveiled their newest monitoring tool, which aims to eliminate risky cryptocurrency blind spots for banks, the firm said in a press release on 28 April.

According to the announcement, “CipherTrace Armada” is a new transaction monitoring tool, which has been designed to flag payments to high risk Virtual Assets Services Providers (VASP). Unlike the other products offered by CipherTrace, and its competitors, Armada has been focused on off-chain data instead of on-chain, and can also work in tandem with existing bank monitoring tools.

The press release reads:

“CipherTrace launches Armada to support banks and financial institutions in achieving AML compliance by providing critical visibility into risky cryptocurrency blind spots so know your customer (KYC) processes can detect and perform due diligence on virtual asset service providers (VASPs).”

The new tool can “plug into” already existing transaction monitoring systems, and look for illicit activities through machine learning, clustering algorithms, and the company’s database of high risk entities, which contains over 500 businesses involved in virtual asset transactions. With this, Armada is able to catch Money Services Businesses (MSB) which may be hiding their true nature through hidden accounts and different names.

As an example, CipherTrace pointed out to the unlicensed Bitcoin seller Kunal Kalra. The company claims that if Kalra’s bank had used Armada to monitor its accounts, it could have identified Kalra’s illicit activities a lot sooner. Last year, Kalra pleaded guilty in running an unlicensed MSB using fake names, transfers to a Gemini account and anonymous Bitcoin ATM’s. He was able to exchange around $25 million in cash and cryptocurrency for darknet drug dealers.