Elliptical Connect, a blockchain knowledge analytics agency, launched a report Wednesday — broadly coated in each the crypto and news media — entitled “Cross-chain Crime: More Than Half a Billion Dollars has Been Laundered Through a Cross-chain Bridge.”
Elliptical states “the RenBridge has facilitated the laundering of at least $540 million in proceeds of crime.”
The article additionally promotes a brand new analytics device known as “Holistic Screening.” The analytics utility “allows proceeds of crime to be traced, even when they move between blockchains through services such as RenBridge.”
Visualizations of Holistic Screening showcase its capability to map and hint transactions between identified wallets throughout blockchains.
However, the language used might be thought of deceptive when aligned with the idea of “money laundering,” which requires an utility to give you the option to ‘wash’ funds in order that they can’t be traced again to their authentic proprietor.
Ren runs on a public blockchain with out any mixer expertise dealing with the cross-chain bridge. RenMAX, a core contributor who works in operations at Ren Labs, informed CryptoSlate,
“Every transaction through the Ren Bridge is completely public, transparent and on-chain. Each Ren deposit address is deterministically created using the address intending to receive the asset on the other side, meaning you can always determine which addresses are tied together.”
He continued to describe the method by which transactions may be publicly verified on-chain and ensure that it’s “impossible to hide or launder any assets through Ren.”
“As such it is impossible to hide or launder any assets through Ren as every transaction and interacting addresses are fully traceable.”
In an Aug. 10 tweet, Elliptical promoted its analytics expertise, stating that it “merges every crypto asset and blockchain into a single financial network.” There is a myriad of potential use instances for analyzing and investigating potential unhealthy actors with its Nexus product.
While the Elliptical toolset might give you the option to streamline and enhance the traceability of blockchain transactions, it’s unclear the way it can reveal info that’s not already public.
Cross-chain monetary crime is the brand new actuality for cryptoassets. Elliptic Nexus merges each cryptoasset and blockchain right into a single monetary community, consisting of lots of of billions of datapoints and divulges danger that isn’t seen when solely taking a look at particular belongings. pic.twitter.com/5q9uWfrFC7
— elliptic (@elliptic) August 10, 2022
The Ren bridge permits customers to transfer crypto belongings between blockchains through wrapped tokens equivalent to renBTC, renZEC, and renBCH.
Ren makes use of nodes known as ‘Darknodes,’ that are “periodically shuffled into random non-overlapping groups, known as shards to make it resistant to attacks. The secrecy of ‘Darknodes’ is unrelated to on-chain privacy regarding bridged assets.
Amid widespread reports of Ren being used for money laundering, it launched Ren 2.0, an upgraded version of its RenVM protocol. The announcement was overshadowed by the Elliptical article that tied the platform to North Korea hacking groups.
Ren 2.0 adds additional security and features to the protocol with no mention of the privacy features that would be required for it to facilitate money laundering successfully.
1/ Today, we are excited to introduce the next iteration of Ren in this emergent Multichain world ✨
Ren 2.0: an open protocol enabling novel multichain application development with EVM supporthttps://t.co/LR7rKpYyt0
— Ren (@renprotocol) August 10, 2022
As confirmed by renMAX, all Ren transactions are fully transparent and visible through the Ren Explorer. The below image illustrates a transaction allowing Bitcoin to be moved to the Ethereum blockchain through the bridge. The recipient and sender’s addresses are visible, making it of little use to money launderers.
Ren’s Discord community was noticeably upset with the press coverage. One user told CryptoSlate, “it is quite worrisome, especially if OFAC or any other regulator issues a blanket ban without due diligence.”
The considerations emerge at a time when the U.S. Treasury Department has sanctioned Tornado Cash, inflicting Circle to freeze wallets associated to the protocol.
The Ren bridge has reportedly transferred over $12 billion in assets, with many belonging to retail customers wanting to expertise an open and freely interoperable blockchain ecosystem.