In the rapidly evolving landscape of blockchain intelligence used to combat crypto fraud and financial crime, understanding and interpreting on-chain activity has progressed through significant stages. The first generation was characterized by raw blockchain data, offering a foundational layer of insights. This was followed by the second generation, attribution, which greatly advanced blockchain investigations by linking addresses to real-world entities. Today, TRM Labs is proud to introduce the next leap forward: Behavioral Intelligence, marking the inception of the third generation of blockchain investigations.
The third generation of blockchain intelligence is emerging with TRM Labs’ launch of Transfer Labels
TRM pioneered the foundations for Behavioral Intelligence in 2020 with the launch of Signatures®, a capability that identifies patterns across groups of transactions on-chain that are indicative of an underlying suspicious behavior that might have otherwise gone unnoticed. Signatures allow investigators to quickly find and plot sophisticated money laundering techniques and other typologies on-chain.
To make the data on the blockchain more understandable and actionable for investigators, TRM is enriching Behavioral Intelligence with the introduction of Transfer Labels—a dataset that enriches the context of what specific transactions signify on-chain. Currently, most tools reflect the flow of funds between entities simplistically with no signal of the purpose of the transaction. Transfer labels allow for examining a transaction to understand what is happening within it, such as messages being stored on the blockchain, the creation of a smart contract, funds being stolen on-chain or the payment of ransom.
“Since we started working with blockchain data, our goal has been to understand and explain the actions taking place within it,” said TRM Labs CEO Esteban Castaño. “Behavioral Intelligence combines detailed transaction analysis with pattern recognition to provide a clearer picture of blockchain activities. This is a significant development for blockchain investigations, offering both detailed insights and a broader understanding of on-chain events.”
This approach will help:
- Law enforcement agencies uncover and act against sophisticated obfuscation techniques more quickly
- Financial institutions and cryptocurrency businesses enhance due diligence capabilities and improve regulatory compliance
- Tax authorities more effectively detect tax evasion
TRM Labs is making this technology available to agencies and organizations interested in deepening their understanding of blockchain activities. Behavioral Intelligence represents a significant step in the evolution of blockchain investigations, providing tools for a more nuanced analysis of blockchain data.
For more information on Behavioral Intelligence and how it can be applied to your needs, please contact our team.
About TRM Labs
TRM provides blockchain intelligence to help financial institutions, cryptocurrency businesses and public agencies detect, investigate and manage crypto-related fraud and financial crime. TRM’s risk management platform includes solutions for cryptocurrency anti-money laundering (AML), transaction monitoring and wallet screening, entity risk scoring including Know-Your-VASP, and transaction tracing for investigations. These tools enable a rapidly growing cohort of organizations around the world to safely embrace cryptocurrency-related transactions, products, and partnerships. TRM is based in San Francisco, CA and is hiring across engineering, product, sales, and data science. To learn more, visit www.trmlabs.com.