Crypto Project Sues Chainalysis

The brand new 12 months appears set to start out tumultuous for Chainalysis. Along with the trial for Roman Sterlingov set to start on February twelfth, which questions the reliability of Chainalysis Reactor in a multi-million greenback cash laundering allegation, Chainalysis is now getting sued by the crypto challenge YieldNodes.

Of their 2023 Crypto Crime Report, Chainalysis alleged that YieldNodes, a Hong Kong primarily based challenge which rents out computing energy to take part in a masternode pool, is a rip-off. Of their crypto rip-off exercise summarized graph, Chainalysis depicted YieldNodes because the second largest crypto rip-off in income of 2022 with a complete of $341.6M. Notably, Chainalysis’ graph fails to have caught FTX, one of many largest crypto scams so far having misappropriated $8 Billion of customer funds.

“They never tried to contact us before publishing their report, and when we tried to contact them to discuss their report, all they did was direct us to their sales representatives and try to sell us licenses for their software,” writes YieldNodes of their newsletter.

Chainalysis’ categorization had devastating penalties for YieldNodes’ enterprise, as members have been blocked from depositing and withdrawing income from exchanges. Reputational harm continued to ensue as Chainalysis’ declare unfold throughout media, resulting in the removal of YieldNodes merchandise from buying and selling platforms.

In a brief assertion, YieldNodes instructed me that they had solely came upon about Chainalysis’ categorization after receiving transaction errors from members. YieldNodes now accuses Chainalysis of placing “marketing ahead of reliability”, citing the admitted lack of scientific proof for his or her flagship product, referring to the absence of false optimistic charges, false damaging charges, and margin of error charges.

In July, YieldNodes encouraged tasks to affix a potential class motion lawsuit towards Chainalysis, citing the corporate’s dimension and the related prices with difficult Chainalysis’ claims in courtroom. Chainalysis, based in 2014, is a blockchain surveillance agency providing its merchandise to exchanges, monetary establishments and legislation enforcement companies, together with ICE, IRS, FBI, SEC and DEA. Chainalysis has received over $3.3 Million from InQTel, the non-profit enterprise capital arm of the CIA, since 2020. 

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