Stellar Partners With Blockchain Analysis Provider, Elliptic; XLM Transactions Will Now Be Screened
- Blockchain forensics firm Elliptic has entered a new partnership with the Stellar Development Foundation.
- With the new partnership, Elliptic aims at making cryptocurrency transaction activity on Stellar’s platform far more transparent and accountable.
On the 30th of April, Stellar and Elliptic formally signed the partnership agreement with Stellar posting the news on their official twitter handle the same day. Elliptic’s main task is helping cryptocurrency firms through its analytics to manage and eliminate risks like terrorist financing, money laundering, and other illegal activities. With this new partnership, Stellar will rely on Elliptic to help meet regulatory compliance on its open network. This will be the first transaction monitoring system on Stellar.
CEO and Executive Director of the Stellar Foundation Denelle Dixon said,
“Combining their services with the built-in compliance functionality of the Stellar network, we are empowering crypto businesses and financial institutions with stronger tools to manage risk and operate with transparency and accountability.”
Elliptic is already in partnership with several cryptocurrency companies [Binance, Zilliqa, and Wells Fargo] even before Stellar. However, there has always been debate on whether it is a comfortable idea to allow the transaction operations to be tracked and assessed by a third party.
Stellar’s cryptocurrency powerhouse Stellar Lumens (XLM) will have its transactions subjected to screening, this will apply to the user wallets as well. Despite being a positive move towards compliance, this has not been received well by certain firms and businesses with a solid interest in Stellar who claim that their privacy is being invaded as well.
The Stellar Foundation, through their spokesperson, was quick to respond clarifying that as at the moment Elliptic will only monitor XLM transactions. Monitoring will not automatically apply to businesses that are using Stellar. That's a comforting thought for businesses that want to remain private. However, they have been advised to take advantage of the current platform offered by Elliptic. The CEO of Elliptic, Simone Maini, said that the recent partnership will fulfill compliance needs for businesses, enabling them to effectively build on Stellar’s network.
For firms and businesses to fully satisfy regulation concerns, they have to try and copy Libra’s decision of withdrawing a permissionless network to accommodate certain regulations. This way, compliance, and privacy can co-exist.