The specialist in flow analysis on the blockchain Chainalysis Pavoise. The company has just welcomed the legal decision rendered in the proceedings against Roman Sterlingov, accused of having managed Bitcoin fog. At the head of this mixer, this thirty-year-old Russian-Swede laundered 1.2 million bitcoins, or around $400 million. The majority of these were flows linked to illegal sales of narcotics, computer hacking and child pornography images.
Beyond the decision on the guilt of the accused, Chainalysis is first interested in the anointing it has just received from the American justice system for its famous Reactor software. This is one of the Rolls of crypto investigation – the Court of Auditors recently noted that a single basic Chainalysis license costs around 50,000 euros per year.
“A historic date”
For the company headed by the Danish Michael Gronager, the judicial verdict indeed validates the use of its solution as proof. It is “a historic date concerning the admissibility of evidence via our blockchain analysis tools”, added Guillaume Lamboy, a former national police officer recruited by the firm, on Linkedin.
This is obviously not the first time that Chainalysis tools have been used in a legal case – they have become essential in ransomware cases or against black markets. But as Wired explained two years ago, Roman Sterlingov’s defense had chosen to plead for acquittal by pointing to erroneous blockchain analysis techniques, notably pointing out its opacity.
During the trial, Roman Sterlingov explained that he had used Bitcoin Fog to protect his privacy. He therefore presented himself as a simple user of the service, victim of a misinterpretation of crypto flows. As cited by Fortune, he was able to benefit from the scathing testimony of Jonelle Still, the director of investigations and intelligence at Cyphertrace, a competitor to Chainalysis. Reactor’s results “are unverifiable and should not be used in court,” she said.
A reliable product
An argument which, however, did not convince the American magistrate. In turn, this legal challenge even ultimately benefits Chainalysis. The analysis generated by its Reactor software “is the product of reliable principles and methods,” summarizes Judge Randolph D. Moss. The latter believes that there is substantial evidence proving the high reliability of the software, on the contrary even conservative, in the grouping of bitcoin addresses, the method used by Reactor to track flows.
“Many of the results generated by Reactor have been confirmed by traditional analysis of the blockchain,” adds the magistrate in an order of around thirty pages. Even if there may have been “a handful of errors” in the grouping of hundreds of thousands of addresses to assess the extent of illicit activities, these are “probably unimportant”, he believes. -he. One more argument for the company to conquer or keep markets in crypto investigation.