Dapper Labs partners with Chainalysis to thwart illegal activities

Dapper Labs, the developer of popular Ethereum-based NFT game Crypto Kitties and NBA Top Shot, has entered into a long-term partnership with blockchain analysis firm Chainalysis.

Chainalysis disclosed this news through a report on October 7, saying this deal will see it help Dapper Labs make business and compliance decisions. The company seeks to achieve this by monitoring Dapper Labs transactions.

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According to the report, the rapidly expanding NFT sector has seen players like Dapper Labs increase their customer base quickly. However, this expansion introduces more exposure to illicit activities, such as money laundering and market manipulation.

As such, NFT firms need a comprehensive monitoring solution that helps them detect and prevent such activities. 

To achieve this feat, Dapper Labs will leverage Chainalysis KYT and Chainalysis Reactor. Chainalysis KYT, allegedly, identifies illicit and risky activities in real-time. On the other hand, Chainalysis Reactor probes the transactions that the first tool marks as illegal.

Confident that Chainalysis will meet the demands of Dapper Labs, the company’s co-founder and Chief Strategy Officer, Jonathan Levin, said,

We are excited to partner with a market leader in bringing the world of entertainment onto the blockchain, and look forward to helping Dapper Labs scale its compliance processes as the company pioneers new consumer use cases.

Levin added that Chainalysis is gearing up to support a world in which all types of value, including art, business transactions, among other unique digital experiences, live on blockchain networks.

Fostering NFT adoption by creating a safe environment

According to Dapper Labs’ Associate Director of Compliance, Naeem Bawla, the NFT space has emerged as one of the most interesting sectors in the crypto-verse.

However, the industry’s growth balances on whether developers can create a safe environment for customers. Bawla added that this partnership with Chainalysis will go a long way in warding off potential malicious actors from Dapper Labs.

Lana Schwartzman, Dapper Labs’ Chief Compliance Officer, remarked that embracing Chainalysis’ compliance will help Dapper Labs snuff out money laundering as well as stay on top of the quickly-evolving local and global regulatory and compliance space.

This news comes after Dapper Labs partnered with the National Football League (NFL) and the National Football League Players Association (NFLPA) to create NFTs of memorable video highlights. Through this joint venture, the NFL seeks to boost fan engagement.

The NFT drops are set to come later this season and will feature moments in upcoming games, as well as videos of the greatest plays in the game’s history.