London-based blockchain analytics firm Elliptic who provided technology to major US crypto exchange Coinbase has denied the allegations that it collects and sells clients’ user data to third parties for financial gain.
The Director of Institutional Sales of Coinbase, Christine Sandler, said in an interview where she defended their acquisition of Neutrino, that it was important that they “migrate away from our current providers, they were selling client data to outside sources”. It is assumed she was talking about Elliptic.
James Smith, Elliptic’s CEO and co-founder has written an official statement saying: “I have been disappointed to see reporting in the past few days which has incorrectly implied that Elliptic is distributing personal information for financial gain. Such comments fundamentally misunderstand the data we analyse, the insight we share with our clients, and the role we play in the industry”.
Elliptic provide anti-money laundering (AML) compliance software and forensic and investigative services to cryptocurrency exchanges, major financial institutions, and government agencies in order to analyze millions of dollars in transactions every month.
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“Our exchange clients, including Coinbase, do not provide us with any personally identifiable information about their users,” writes Smith. “Our clients use our solutions to screen specific transactions for risk. We do not require or request any transaction data that we can link to individuals, and do not have any other client information such as names, addresses or social security numbers”.
In a list of FAQs, Smith outlines what personal data on a client’s end users Elliptic receives. His answer: “None”.
“We hold no KYC data whatsoever. We do not ever want or need to know who the private individual is behind any transactions being analysed by an exchange. This information is not relevant to our ability to screen transactions for suspicious activity. As a result, we do not receive or hold any information about the end users of our clients”.
He reiterates: “When onboarding new clients, we explicitly inform our users that we do not want or require any personal data on their end users in order to screen transactions for anti-money laundering purposes”.
Smith urges clients and potential clients to share any questions or concerns with him directly at firstname.lastname@example.org.