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Crypto sleuthing firm Chainalysis has added support for Crypto.com’s Cronos blockchain, its native coin CRO, and all CRC-20 tokens that trade on the Cronos chain to its Know Your Transaction service.
This marks the latest upgrade to the Chainalysis KYT service, which flags suspicious and high risk transactions for compliance teams at traditional and crypto financial institutions. The service counts Robinhood (HOOD), BNY Mellon (BK), PayPal (PYPL) and Genesis among its clients.
Cronos is an inter-blockchain protocol, or internet of blockchains, built using the Cosmos software development kit. It’s been popular with decentralized gaming developers because it’s aimed at enhancing interoperability between blockchains.
That makes its addition to crypto compliance software especially significant. Bridge chains, which connect one blockchain to another, have been popular targets for hacks and exploits resulting in stolen cryptocurrencies worth billions.
The most recent example is the Ronin hack, which drained 173,600 ETH (worth roughly $622 million at the time) and 25.5 million US Dollar Coin (USDC) from the bridge chain that connects the Axie Infinity game to the Ethereum mainnet.
“Increasingly, it’s become a commonly accepted thesis that we are going to live in a multichain world,” said Cronos managing director Ken Timsit, referring to the prediction that no one cryptocurrency will become so dominant that it will make the rest obsolete. “But when you make the link between multichain concept and all the hacks that have happened recently on bridges—taking hundreds of billions of dollars—you can see that this multichain world creates new risk challenges.”
As of Tuesday evening, Cronos accounted for $3.85 billion worth of the $208.3 billion total value of assets deposited in DeFi protocols, according to DeFi Llama. Meanwhile, the native CRO token had a market cap of $10.5 billion, making it the 18th largest token by market capitalization, according to CoinMarketCap.
Chainalysis was founded in 2014 after Michael Gronager, then COO at cryptocurrency exchange Kraken, decided there should be a tool to make it easier to follow the money while aiding officials during an investigation of the Mt. Gox crypto exchange.
In 2014, after users experienced issues withdrawing their money from the exchange, it was revealed that 850,000 Bitcoin had been stolen. At the time, the BTC was worth $350 million. But because the rudimentary exchange processed 70% of all Bitcoin transactions, it was enough to send the BTC price plummeting from $800 to $400.
“Over the past year, we’ve seen tremendous growth in the DeFi and Web3, and it’s still early days,” said Chainalysis president and chief revenue officer Thomas Stanley. “We are thrilled to partner with a leader like Cronos to ensure that as this exciting ecosystem continues to grow, it does so safely and compliantly.”