Stellar, Elliptic partnership to provide monitoring infrastructure

Stellar, Elliptic partnership to provide monitoring infrastructure

Stellar (XLM) announced that they have begun a partnership with Elliptic, a crypto-asset risk management firm.

According to the announcement, the partnership between Stellar and Elliptic aims to provide wallet screening capabilities.

Elliptic will provide the technological infrastructure to track individual transactions happening inside the Stellar blockchain.

Stellar and Elliptic to ‘bring further confidence and safety’

The goal of the partnership is to “bring further confidence and safety to the Stellar network.” Elliptic will provide monitoring, compliance, and analysis software on the XLM blockchain.

Denelle Dixon, CEO and executive director of the Stellar Development Foundation, said in the announcement:

“Combining their [Stellar’s] services with the built-in compliance functionality of the Stellar network, we are empowering crypto businesses and financial institutions with stronger tools to manage risk and operate with transparency and accountability.”

What is the monitoring infrastructure that Elliptic will provide?

According to the announcement, the technology from Elliptic will provide members of the XLM network the ability to track the transactions on its system.

The network may consist of organizations such as financial institutions, businesses, and regulators.

Stellar, Elliptic partnership to provide monitoring infrastructure

The announcement noted that the tools they will be providing will enable institutions to identify illegal transactions as they happen within the network — all with the aim of helping address money laundering, sanctions evasion, and terrorist financing.

Such developments would help them in terms of better compliance with Know-Your-Client (KYC) and Anti-Money Laundering (AML) regulations.

Simone Maini, chief executive officer of Elliptic said:

“As regulations mature, it will become increasingly important for crypto-asset issuers and platform developers to enable their users to stay compliant if adoption is to grow. The Stellar Development Foundation has been ahead of the curve in working with Elliptic on this.”

Elliptic is also a partner of Binance, Zilliqa, and Wells Fargo.

According to the announcement, Elliptic has already been working with Stellar for several months. They have already been at work with the infrastructure and preparations for integration with Stellar.

The next step for Elliptic analysts is to study transactions that happen inside the dark web, money laundering patterns, and data collection for XLM accounts that are linked to known entities.

Future directions

Some are not comfortable with a third party having a peek at the transactions going on in the network. After all, the cryptocurrency industry has been touted by many as a way to perform transactions privately.

This makes the partnership between Stellar and Elliptic a tough balancing act between protecting user privacy while disincentivizing illicit transactions.

Images courtesy of Jim Makos/Flickr, Richard Patterson/Flickr

Micky is a news site and does not provide trading, investing, or other financial advice. By using this website, you affirm that you have read and agree to abide by our Terms and Conditions.
Micky readers - you can get a 10% discount on trading fees on FTX and Binance when you sign up using the links above.