Blockchain Vendor Elliptic Raises $5 Million Series A

Paladin Capital Group, a venture capitalist specializing in firms dealing in cyber and digital infrastructure resilience, led the round, along with Santander InnoVentures, a fintech venture capital (VC) firm owned by Spanish bank Santander Group, and fellow VCs KRW Schindler, DCG Insights and Octopus Ventures, which has already invested.

Christopher Steed, managing director of Paladin Capital, will join Elliptic's board of directors with Octopus Ventures. Santander InnoVentures will join as a board observer.

Elliptic uses graph analysis and machine learning to identify illicit activity in blockchain transactions.

In January, Santander InnoVentures held a competition for startups in the blockchain space.

"Distributed ledger technology, including blockchain, has huge potential to deliver cost savings and new ways of working across the global banking industry—but most blockchain applications today are still in the proof-of-concept stage," says Mariano Belinky, managing partner of Santander InnoVentures. "For distributed ledger technology to achieve widespread use, compliance departments and regulators will demand independent monitoring capabilities to combat insider trading, fraud, and money laundering."