Wells Fargo Strategic Capital (WFSC) infuses $5 million in Blockchain forensic firm, Elliptic. This brings Elliptic’s Series B round to a total of $28 million. The investment is partially geared toward a newly launched product that helps crypto exchanges win relationships with banks.
The product, Elliptic Discovery, offers a health bill for over 200 crypto exchanges worldwide, answering everything from how they conduct know-your-customer (KYC) checks to whether they’re regulated properly.
Elliptic co-founder Tom Robinson said, “Previously, a bank just didn’t know much about the exchange that was wanting to open an account with them. This will give them insights into how risky or otherwise a given crypto exchange is.”
He further added, “Helping banks hook up with exchanges is a use case that’s probably under appreciated. Elliptic Discovery really does help a bank to engage more closely with crypto exchanges.”
Nearly all big banks have steered clear of crypto businesses because of the common perception that the risk of dealing with potentially unpleasant transactions outweighs the benefits. The job has been left to a few minor financial institutions, including the U.S.-based Silvergate and Signature banks.
With law enforcement agencies backing crypto and crypto regulations becoming clearer, firms like Elliptic are about to have a bright future ahead. Wells Fargo is not the sole bank to have taken an interest in Elliptic, however it is the first one from the U.S.
Last September, SBI Holdings, Japanese banking group invested $10 million to support Elliptic’s expansion plans in Asia. Santander InnoVentures, SignalFire, AlbionVC and Octopus Ventures are some other investors.
