JP Morgan invests in TRM Labs amid blockchain push
JP Morgan has become the latest banking giant to signal support for blockchain technology with an investment in TRM Labs.
TRM Labs, a blockchain analytics firm which monitors crypto transactions for suspicious activity and traces the movement of illicit funds, announced yesterday that it has received a seal of approval from the world’s largest bank in the form of an investment for an undisclosed sum.
JP Morgan joins a growing club of payments industry heavyweights to invest in TRM Labs which received support from Paypal Ventures, Visa and American Express in a recent $60m series B funding round led by Tiger Global.
“TRM’s vision to drive security and integrity in crypto ecosystems through sophisticated analytics solutions aligns with our ambitions for building blockchain products at JP Morgan that are compliant and secure,” said Umar Farooq, the chief executive of the bank’s blockchain division Onyx.
“We’ve spent the last six years exploring the possibilities and applicability of blockchain technology – leading infrastructure companies like TRM will help usher in the future of secure blockchain and crypto use cases,” Farooq added, hinting that Onyx has plans to roll out blockchain based products and services.
The announcement comes less than a week after US bank BNY Mellon announced a partnership with Chainalysis, a compliance and blockchain analytics firm which also tracks illicit activity taking place on the blockchain. The 238-year-old bank disclosed to City PM that it plans to launch a crypto custody platform later this year which will rely upon Chainalysis to ensure due diligence and compliance.
Banks are increasingly turning to private sector actors to decrease the risks associated with crypto transactions for investors. Last year an estimated £10bn of crypto trade volume was associated with illicit activity and concerns about the risks associated with crypto trading remain a barrier to wider adoption.
Commenting on JP Morgan’s investment in TRM, the company’s chief executive Esteban Castaño said he is “thrilled” to have an opportunity to “enable a safer crypto economy.”
“This investment clearly highlights the significance of the growing crypto economy and the importance of building trust and safety in this ecosystem to sustain its growth,” said Castaño.
TRM’s transaction monitoring solutions allow financial institutions and cryptocurrency businesses to meet Anti-Money Laundering (AML) regulatory requirements to manage reputational and operational risk. Law enforcement agencies use the company’s forensics tool to investigate sophisticated crypto-related crime.
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