Public Key

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USA Crypto Compliance Trends in 2024 May 06, 2024

Show notes

From the Bitlicense to OFAC Sanctions, Ian Andrews (CMO, Chainalysis) and guest Valerie-Leila Jaber (Global Head of Anti-Money Laundering, Coinbase) cover it all on this episode of Public Key.
Valerie-Leila highlights the importance of compliance in the crypto industry and the impact of regulations, such as the Patriot Act, when it first came out and how they parallel the current regulatory landscape in crypto.

She provides insights into Coinbase's focus on setting global minimum standards and their involvement in initiatives like TRUST for Travel Rule compliance, BASE their layer 2 blockchain and their new wallet releases.
Valerie also touches on the topics of sanctions, Coinbase's noncustodial wallet, and the company's role as custodian in the Bitcoin spot ETFs.

Minute-by-minute episode breakdown

2 | Valerie's interest in crypto and experience in traditional finance

4 | Technology shifts and challenges in implementing AML regulations

7 | The variation in Crypto AML regulations across different countries

9 | Coinbase's involvement in the TRUST initiative and BASE, its Layer 2 blockchain

12 | The usefulness of receiving crypto addresses from OFAC for compliance purposes

15 | Discussion on the Coinbase Wallet and its position within the AML department

18 | The challenges and benefits of multiple state-level regulatory frameworks for crypto

20 | The role of Coinbase's compliance program in being selected as a custodian for many ETFs

22 | Excitement for the year ahead in terms of legislation, market buoyancy, and international developments

Related resources

Check out more resources provided by Chainalysis that perfectly complement this episode of the Public Key.

Speakers on today’s episode

Ian Andrews * Host * (Chief Marketing Officer, Chainalysis)
Valerie-Leila Jaber (Global Head of Anti-Money Laundering, Coinbase)

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Our podcasts are for informational purposes only, and are not intended to provide legal, tax, financial, or investment advice. Listeners should consult their own advisors before making these types of decisions. Chainalysis has no responsibility or liability for any decision made or any other acts or omissions in connection with your use of this material.

Chainalysis does not guarantee or warrant the accuracy, completeness, timeliness, suitability or validity of the information in any particular podcast and will not be responsible for any claim attributable to errors, omissions, or other inaccuracies of any part of such material.

Unless stated otherwise, reference to any specific product or entity does not constitute an endorsement or recommendation by Chainalysis. The views expressed by guests are their own and their appearance on the program does not imply an endorsement of them or any entity they represent. Views and opinions expressed by Chainalysis employees are those of the employees and do not necessarily reflect the views of the company.

How Ukrainian Cyber Police are Fighting Russian Hackers May 02, 2024

Show notes

“They want to destroy as many of our systems and resources as they can get the access to." - Yevhenii

In this episode Ian Andrews (CMO, Chainalysis) speaks to Yevhenii Panchenko (Head of Operational Analysis, Ukraine Cyberpolice Department.
Yevhenii discusses the global fight against Russian cyber actors, who target not only Ukraine but also other countries and shares the work his organization is doing to combat cyber threats, including investigating crimes related to fraud, ransomware, and illegal content.

He shares the challenges they face in stopping Russian organizations and the importance of international collaboration and volunteers in identifying fraud and scam projects.
Yevhenii also announces their new project, SCAMFARI and how they use OSINT to identify crypto fraud and collect data and the impressive features of the DIIA City and the implementation of digital documents in Ukraine.

Minute-by-minute episode breakdown

2 | Discussion on the Ukraine Cyber Police mandate and global nature of cyber threats

5 | Describing Russian cyber attacks on Ukrainian infrastructure

8 | A day in the life of the Ukraine Cyber Police Unit

10 | Russian hackers using cryptocurrency to receive ransoms and evade sanctions

12 | Collaboration with US and EU agencies and training on using Chainalysis

15 | Discussion on the effectiveness of sanctions on crypto flows

18 | What is Scamfari and how they use OSINT to identify crypto fraud and collect data

21 | Impressive features of the DIIA City and the implementation of digital documents

23 | Recommendations for supporting Ukraine, including cryptocurrency investigation skills

Related resources

Check out more resources provided by Chainalysis that perfectly complement this episode of the Public Key.

Speakers on today’s episode

Ian Andrews * Host * (Chief Marketing Officer, Chainalysis)
Yevhenii Panchenko (Head of Operational Analysis, Cyberpolice Department, National Police of Ukraine)

The Path Forward for Binance Compliance Program Apr 29, 2024

Show notes

"Compliance always needs to be improving.” - Noah

In this episode Ian Andrews (CMO, Chainalysis) speaks to Noah Perlman (Chief Compliance Officer, Binance), whose exchange was very focused on trading and users in the early days and now turning the page to building out a robust Compliance program.
Noah shares his journey from being a prosecutor at the US Attorney's Office, working at Morgan Stanley, to his current role at Binance.

He discusses the challenges and opportunities of working in compliance in the crypto industry, the importance of trust and transparency and the steps Binance is taking to improve its compliance program.

Noah also talks about the collaboration between Binance and law enforcement agencies, the regulatory landscape in different countries, and his excitement for innovation and the future of centralized exchanges vs decentralized platforms.

Minute-by-minute episode breakdown

2 | Noah's transition from a prosecutor to Chief Compliance Officer at Binance

6 | Experience and cultural differences between TradFi and Crypto

9 | Importance of rebuilding trust in the crypto market and industry

12 | Impact of the settlement with the US government on Binance and Chief Compliance Officer role

15 | Collaboration with law enforcement and focus on rooting out bad actors

19 | Discussion on the future of crypto and the role of centralized exchanges

21 | Debate on the US government's approach to crypto regulation

25 | Excitement about innovating in compliance through technology and killer crypto use cases

Related resources

Check out more resources provided by Chainalysis that perfectly complement this episode of the Public Key.

Website: Binance: 188,487,264 Users Trust Us!
Blog: Binance FZE Receives a VASP Licence from Dubai’s Virtual Assets Regulatory Authority
Blog: Binance’s Proof-of-Reserves System: A Year of Upgrading User Assets Transparency
Press Release: Statement Regarding Tigran Gambaryan
Registration: Digital premiere of Links 2024 (NYC Main Stage Content and more - Register Now!)
Blog: London’s Metropolitan Police Lead Disruption of Phishing-as-a-Service Provider LabHost
YouTube: Chainalysis YouTube page
Twitter: Chainalysis Twitter: Building trust in blockchain
Tik Tok: Building trust in #blockchains among people, businesses, and governments.
Telegram: Chainalysis on Telegram

Speakers on today’s episode

Ian Andrews * Host * (Chief Marketing Officer, Chainalysis)
Noah Perlman (Chief Compliance Officer, Binance)

The Company That's Stopping Web3 Cyber Attacks Apr 22, 2024

Show notes

What if there is a company that can detect web3 cyber attacks and hacks before they happen?

In this episode Ian Andrews (CMO, Chainalysis) speaks to Gal Sagie, who is the Co-Founder and CEO of Hypernative, whose company is doing just that. Preventing malicious cyber threats aimed against the most important protocols and blockchains in the ecosystem,
Gal showcases Hypernative’s end-to-end security and risk prevention platform and shares insights into the importance of security in driving wider adoption of blockchain technology.

He discusses how Hypernative's platform has successfully detected and prevented hacks and exploits in the industry and highlights the need for a comprehensive security approach beyond traditional smart contract audits and emphasizes the role of real-time monitoring and automated actions in mitigating risks.
He also explains the accuracy of detection, the ease of onboarding and the need for his company to maintain low false positive alerts and the team’s focus to expand to more chains and protocols.

Minute-by-minute episode breakdown

2 | Overview of Hypernative and its mission in Web3 security

6 | Discussion on the importance of solving the security problem for wider adoption

10 | The speed of detection: 98% of attacks being detected 2 minutes or more before the first transaction

13 | Chainlink and other ideal users of Hypernative: protocols, chains and investors

16 | The focus on accuracy to minimize false positives and maintain trust

19 | The limitations of smart contract audits and the need for additional security measures

23 | The endless information available on the blockchain for security analysis and the goal to detect all potential risks with minimal effort from customers

27 |The importance of detecting and preventing attacks before any funds are lost

31 | Hypernative's roadmap for the year ahead and plans for expansion

Related resources

Check out more resources provided by Chainalysis that perfectly complement this episode of the Public Key.

Website: Hypernative: Institutional Grade Web3 Security
Twitter: Hypernative stops zero day cyber-attacks and economic risks
Blog: Chainlink Labs and Hypernative Partner to Enhance Web3 Security
Blog: Chainalysis Partners with Hypernative for Real-Time Security and Incident Response
Press Release: ‘SEAL 911’ team of white hats formed to fight crypto hacks in real time
Registration: Digital premiere of Links 2024 (NYC Main Stage Content - Register Now!)
Blog: What You Need to Know About the Bitcoin Halving
Podcast: Bitcoin Mining and Data Centre Innovations: Podcast Ep. 76
YouTube: Chainalysis YouTube page
Twitter: Chainalysis Twitter: Building trust in blockchain
Tik Tok: Building trust in #blockchains among people, businesses, and governments.
Telegram: Chainalysis on Telegram

Speakers on today’s episode

Ian Andrews * Host * (Chief Marketing Officer, Chainalysis)
Gal Sagie (Co-Founder & CEO of Hypernative)

Everything (Including Blockchain) is Bigger in Texas Apr 15, 2024

Show notes

Everything is Bigger in Texas. Especially blockchain technology and Bitcoin mining operations.

Ian Andrews (CMO, Chainalysis) speaks to Lee Bratcher (Founder & President, Texas Blockchain Council), who is one of the pivotal figures making Texas a leader in Bitcoin, blockchain and digital asset innovation.

Lee shares how he and the TBC are shaping Texas as a front-runner in blockchain policy and they both delve into the intricacies of blockchain technology including its governance, potential for solving societal problems and implications for property rights.

Lee highlights the energy economics of bitcoin mining in Texas and the pivotal shifts he has seen in digital asset regulation, with the advent of Bitcoin Spot ETFs.
This episode also breaks down the policy initiatives and legal battles the TBC has had with the U.S. Department of Energy over their emergency energy survey and data collection, as well as TBC’s recent amicus brief submission supporting Coinbase against the SEC.

Minute-by-minute episode breakdown

2 | Lee’s background and how he went from Army reserves to getting into cryptocurrency

4 | The concept of digital property rights and identification and its significance in society

6 | Texas Blockchain Council's impact on changing the narrative around blockchain in Texas and suing the Federal Government

10 | Texas becomes a mining epicenter due to China's blockage

14 | Filing an amicus brief to support Coinbase against the SEC

20 | DeFi Education Fund files preemptive lawsuit against the SEC

22 | The North American Blockchain Summit aims to bring policymakers and regulators together with industry executives

26 | Lee reflects on his interview with Balaji Srinivasan and how the share many profound perspectives

29 | Discussions on criminal activity in crypto and impact of Bitcoin spot ETFS

Related resources

Check out more resources provided by Chainalysis that perfectly complement this episode of the Public Key.

Website: TBC: Making Texas a Leader in Bitcoin, Blockchain & Digital Asset Innovation
Video: What We Do at the Texas Blockchain Council w/Lee Bratcher
Blog: US energy officials agree to ‘destroy’ all data from crypto mining survey
Policy: Texas Blockchain Council Policy Initiatives
Whitepaper: Bitcoin: A Peer-to-Peer Electronic Cash System by Satoshi Nakamoto
Book: The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else by Hernando De Soto
Video Podcast: Crypto & AI are Redefining US Federal System | Balaji Srinivasan and Lee Bratcher on Shifting Dynamics of US Power
Blog: Bitcoin Fog Case Confirms Chainalysis Analytics is Reliable and Admissible in Court
Blog: Chainalysis Links NYC Summaries | Day 1 | Day 2
YouTube: Chainalysis YouTube page
Twitter: Chainalysis Twitter: Building trust in blockchain
Tik Tok: Building trust in #blockchains among people, businesses, and governments.
Telegram: Chainalysis on Telegram

Speakers on today’s episode

Ian Andrews * Host * (Chief Marketing Officer, Chainalysis)
Lee Bratcher (Founder & President, Texas Blockchain Council)

Navigating Complex Crypto and DeFi Taxes Apr 08, 2024

Show notes

It’s that time of year in the USA where the trees are blossoming, the winter jackets are being packed away for the season and there is only one thing on everyone’s mind. Taxes.

But how do you report DeFi transactions, crypto staking and lending and stablecoin purchases? Well Ian Andrews (CMO, Chainalysis) brings in crypto tax generalist, Lorenz Haselberger (Partner at Shearman & Sterling LLP) to dive deep into the most complex tax implications facing the crypto industry.

Lorenz unfolds the nuances of reporting taxes within the dynamic and evolving world of cryptocurrencies and shares his journey into the crypto tax niche and unwraps the critical aspects of current tax considerations.

He discusses the tax challenges with DeFi protocols and underscores the importance of understanding the tax implications for both individual and institutional investors and the need for the US Government to provide more clarity and guidance to the crypto industry

Minute-by-minute episode breakdown

2 | Lawrence's background in taxation and involvement in the crypto industry

6 | Discussion on the complexity of reporting obligations for exotic cases like crypto and DeFi lending

14 | Everything you need to know about staking and potential tax implications

22 | The debate on whether DeFi transactions should be treated as a taxable event

25 | The national and international tax implications for crypto investors vs traders

33 | Debate on expanding information reporting requirements for crypto

36 | Does tax complexity and uncertainty deter some from participating in crypto?

39 | Differentiating stablecoins from cryptocurrencies for tax purposes

42 | The evolution of DeFi protocols and need for Government guidance for crypto tax implications

Related resources

Check out more resources provided by Chainalysis that perfectly complement this episode of the Public Key.

Speakers on today’s episode

Ian Andrews * Host * (Chief Marketing Officer, Chainalysis)
Lorenz Haselberger (Partner, Shearman & Sterling LLP)

The Truth About Crypto Insider and Wash Trading Apr 01, 2024

Show notes

"To really understand market integrity, you need to be able to monitor for market abuse and other forms of illicit finance, on and off-chain."

This is a powerful statement from market manipulation, Chen Arad (Co-Founder & CXO, Solidus Labs), who speaks with Ian Andrews (CMO, Chainalysis) about the heart of market surveillance and integrity in a wildly fluctuating digital asset market.
Chen discusses the need for market surveillance to ensure fair and transparent trading and highlights the challenges of monitoring market manipulation and the significance of on-chain and off-chain data.
Chen also highlights the prevalence of insider trading and wash trading in the crypto market and explores the future of the industry and the importance of building compliant and safe services.

He provides insights on the crypto market's need for robust risk and compliance systems and the growing regulatory recognition of its importance, while revealing alarming statistics revealed in Solidus Labs' Market Manipulation Reports.

Minute-by-minute episode breakdown

2 | Chen Arad's background as a journalist and his path to working in crypto and launching Solidus Labs

7 | Understanding the concept of market surveillance and market integrity in crypto
12 | The approval of ETFs as a vindication for the necessity of market integrity in crypto

16 | The need for cross-market surveillance and integrity

22 | Real-time monitoring in crypto markets and importance of on-chain and off-chain data for market surveillance

28 | Insider trading and wash trading are more widespread than believed

35 | Unpacking the definition and mechanics of wash trading on decentralized liquidity pools

40 | Wash trading involving malicious smart contract scams and potential money laundering

44 | The importance of building compliantly and working with regulators

47 | Potential for cross-market surveillance and growth of on-chain market

Related resources

Check out more resources provided by Chainalysis that perfectly complement this episode of the Public Key.

Website: Solidus Labs: Safeguarding Your Crypto Business
Reports: The Crypto Market Manipulation Report: Pt. 1 Insider Trading | Pt. 2 Wash Trading
Blog: Future of Crypto in the UAE: Insights from Solidus Labs at iFX EXPO Dubai
Blog: Combining On-Chain And Off-Chain Analysis: A Primer
Event: Chainalysis Links Conference NYC 2024 (Apr. 9-10, 2024) - Early Bird Pricing On Now!
Blog: Chainalysis In Action: Israeli Authorities Disrupt Hezbollah and Iran Quds Force Terrorism Financing Crypto Infrastructure, Seize $1.7 Million in First
Blog: OFAC Sanctions Russia-based Blockchain Companies, Including Netex24 and Bitpapa, for Facilitating Sanctions Evasion
Blog: OFAC and OFSI Sanction Social Media News Outlet Gaza Now for Hamas Fundraising in Wake of October 7 Attacks
YouTube: Chainalysis YouTube page
Twitter: Chainalysis Twitter: Building trust in blockchain
Tik Tok: Building trust in #blockchains among people, businesses, and governments.
Telegram: Chainalysis on Telegram

Speakers on today’s episode

Ian Andrews * Host * (Chief Marketing Officer, Chainalysis)
Chen Arad (Co-Founder & CXO, Solidus Labs)

Unlocking Crypto Insights From 100 Episodes of Public Key Mar 25, 2024

Show notes

In this milestone 100th episode, host Ian Andrews (CMO, Chainalysis) takes a break from his usual role and hands the reins over to Kim Grauer (Director of Research, Chainalysis) to discuss the biggest themes and topics from the last 100 episodes.
They reflect on the journey of the podcast, share behind-the-scenes insights, and discuss Ian's transition from the tech industry to the world of crypto and some of the challenges the industry still faces after 2 years of producing the podcast.
Kim gets Ian to share some of the most impactful episodes, including discussions on pig butchering scams, market manipulation, and the future of DeFi.

Ian offers advice for marketers and shares his excitement for upcoming developments at Chainalysis, including the recent decision in the Bitcoin Fog case.

Minute-by-minute episode breakdown

(2:30) – Ian's background at Pivotal and decision to join Chainalysis
(9:15) – Ian's foundational technical knowledge and discovery of the global nature of crypto
(12:30) – The new role of Chief Marketing Officer and the early mandate to grow the company
(14:21) – Ian highlights the pig butchering and market manipulation issue in crypto
(18:49) –Are the rules around accredited investors in the US protecting consumers or restricting them
(22:00) – DeFi hacks, global crypto adoption and the impact of Bitcoin Spot ETFs
(31:05) - Highlighting companies like Ironfish and Hypernative for their exciting innovation
(34:25) - Marketing advice for companies to focus on storytelling rather than traditional marketing
(38:39) - Ian shares his favorite podcasts, including "Pivot," "Invest Like The Best," and "Lex Friedman"
(40:25) - Public Key’s dream podcast guestlist is revealed: Fei-Fei Li, Vitalik Buterin, and Gary Gensler
(42:03) - How to start your own podcast in 2024
(44:05) - What’s New For Chainalysis: The Bitcoin Fog Decision, NYC Links Conference and Huge Products being shipped in 2024

Related resources

Check out more resources provided by Chainalysis that perfectly complement this episode of the Public Key.

Speakers on today’s episode

Ian Andrews * Host * (Chief Marketing Officer, Chainalysis)
Kim Grauer (Director of Research, Chainalysis)

What You Need To Know About Crypto Market Manipulation Mar 18, 2024

Show notes

With Bitcoin reaching all-time highs we thought it would be best for us to revisit one of our most downloaded episodes on Public Key discussing Crypto Market Manipulation, with former Flashpoint founder, Evan Kohlmann and Ian Andrews (CMO, Chainalysis). Evan is now the Founder and CEO of Cloudburst Technologies, a company tasked with scraping the dark web to identify potential pump and dump schemes and the associated illicit actors.

In the episode recorded in February 2023, Evan explains the nuances of these targeted market manipulation attacks, who the orchestrators are, and the countries being targeted. He explains how his team’s technology can gather KYC information and shed some light on the extent these schemes have on the total illicit activity in the industry.

Evan even records an update to this episode highlighting the sudden rise of crypto prices, what are the biggest market manipulation concerns for 2024 and new data that his team is seeing that the general public should be aware of.

Minute-by-minute episode breakdown

(2:27) – Understanding market manipulation in the crypto world and what Cloudburst Technologies is doing about it
(4:35) – How to identify the illicit actors on dark web forums attempting to manipulate the markets
(12:30) – How Evan got the name “The Terrorist Search Engine” and how he helped build up leading dark web intelligence firm, Flashpoint
(15:21) – How millions of people in dark web forums and Telegram are organizing themselves to pump certain tokens 50% up to 500%
(20:49) – Applying Cloudburst technology to traditional commodity markets and large market cap tokens
(28:00) – Are illicit actors targeting decentralized exchanges and protocols or just centralized exchanges
(30:05) - How Cloudburst is able to identify KYC on illicit actors across the dark web using OSINT
(33:25) - Where are illicit actors operating and the biggest market manipulation concerns for 2024

Related resources

Check out more resources provided by Chainalysis that perfectly complement this episode of the Public Key.

Speakers on today’s episode

Ian Andrews * Host * (Chief Marketing Officer, Chainalysis)
Evan Kohlmann (Founder and CEO, Cloudburst Technologies)

The Best of Public Key's Pig Butchering Episodes Mar 11, 2024

Show notes

This week we’ve got a special episode for you. Over the nearly two years since we started the podcast one of our most frequent topics has been the crypto romance / investment scam known as Pig Butchering.

In a Public Key first Ian Andrews (CMO, Chainalysis) highlight impactful statements from past guests, including: Erin West, Alona Katz, Alastair McCready, Nicola Staub and Detective Matthew Hogan, who discuss the scam’s exponential growth has been, with Southeast Asia emerging as a hotbed for these criminal operations.
The guests emphasize that these crimes are not isolated incidents but part of an organized crime network with ties to human trafficking and forced labor, generating billions in stolen funds annually.

The group covers the basics of pig butchering, tactics used by international criminals, challenges in combating the crime and how collaboration and educational awareness are key solutions to preventing this complex crime.
Alastair highlights the neglect by authorities in countries housing these pig butchering scam compounds, while the remaining guests explain how public private partnerships have been the key to info-sharing and collaboration of resources.

Minute-by-minute episode breakdown

(2:15) - What Is Pig Butchering and how is it executed
(8:20) - Detective engages with a pig butchering scammer to gather evidence
(12:50) - Discussion on scammers using legitimate crypto exchanges and web wallets
(16:50) - Human Trafficking victims forced to become scammers and heroic story of a victim's escape
(21:21) - Southeast Asia a hotbed for pig butchering scammers
(27:50) - Limited resources of law enforcement and the collaboration of public and private sector
(31:25) - REACT Task force formed to combat high tech crime including SIM Swapping and Pig Butchering
(36:38) - How are Bitcoin ATMs used to facilitate payment to scammers
(39:25) - Erin West describes why the problem is getting worse and what we need to do to stop it

Related resources

Check out more resources provided by Chainalysis that perfectly complement this episode of the Public Key.