Chainalysis, an 8.6 billion valued startup, is helping the US government track down and snatch a 75 Bitcoin ransom from the hands of hackers.
Chainalysis to the Rescue
According to Bloomberg, In 2021 malignant cyber criminals launched a hack against the company responsible for the United States largest gasoline pipeline- Colonial Pipeline Co. The United States had dreaded the possibility of the imminent attack for years. After the attackers managed to hack the company’s software, Colonial Pipeline Co., was forced to shut down its operations for six consecutive days. The sudden colonial shutdown led to panic in the market as people scrambled to buy its products.
The shutdown also led to massive gasoline shortages and an alternate hike in gas prices all over the United States. The hackers demanded a ransom from the Government, urging the US government to pay the ransom in digital ‘gold’-Bitcoin. The company paid the hackers a huge ransom that totaled 75 Bitcoins, which was worth close to $4.4 million then.
The Grand Recovery
After about a month, the United States Department of Justice (US DoJ) publicly announced to have recovered most of the paid Bitcoins. The cyber attackers preferred the money be sent to them in cryptocurrency form due to the difficulty of cryptocurrency in terms of tracing transactions. Fortunately, the Federal Bureau of Investigations tracked the ransom that the colonial pipeline paid to a wallet address belonging to a Russian Cybercrime group called DarkSide.
The FBI had every reason to believe that DarkSide had direct relations with the attackers or was directly responsible for the colonial Pipeline software Cyberattack. The FBI swam into action seizing most of the ransom-paid BTC. This marked one of the biggest cyberattack reversals in history, where the Government was able to reverse ransom worth close to $4 billion paid to hackers.
The FBI’s bold move to retrieve the funds also signified that the United States enforcement had arms long enough to get to assets held by hackers from anywhere in the world, even though the Government transferred the funds through the irreversible blockchain network-Bitcoin.
“There is no place beyond the reach of the FBI,” Deputy Director Paul Abbate said in a statement.
The FBI has worked hand in hand with Chainalysis to investigate the cryptocurrency transaction that involved DarkSide. Chainalysis had secured $170 million in a funding round led by GIC, a wealth fund based in Singapore. The company, known to help law enforcement arrest illegal crypto activities such as money laundering, saw its total valuation rise to $8.6 billion in less than 12 months.
The company continues to grow exponentially, raising the headcount staff to 700 employees and having more clients paying huge amounts for the services Chainalysis offers. Recently, Chainalysis was credited with helping Laura Shin track down the suspected criminal behind the DAO hack of 2016. The hack involved a loss of $7 Billion worth of Ether.