Elliptic, Internet Watch Foundation Team Up to Combat Crypto Financing of Child Abuse Material

Blockchain intelligence firm Elliptic has become a member of the Internet Watch Foundation, as part of its ongoing efforts to combat the financing of child sexual abuse material (CSAM) via cryptocurrency.

The partnership between the two parties means that Elliptic gains access to the IWF’s range of services, including its virtual currency alerts.

These alerts will provide the London-based company with real-time data on cryptocurrency transactions that involve the purchase of CSAM, identifying the payment networks used in the transactions and the wallet addresses.

By integrating with the IWF’s real-time alert system, Elliptic is aiming to better help its clients prevent transactions associated with child abuse and exploitation.

“IWF analysts find images and videos of some of the worst types of child sexual abuse on websites that profit from the sale of this horrific content,” said acting IWF CEO Derek Ray-Holl. “By working with us, Elliptic can help to disrupt the spread of this criminal imagery and stop this type of illegal purchasing in its tracks.”

Last year, U.S. Senators Elizabeth Warren (D-MA) and Bill Cassidy (R-LA) sent a bipartisan open letter to the U.S. Department of Justice and Department of Homeland Security describing crypto as the “payment of choice for child abuse material.”

Their assertion appears to be borne out by the IWF’s Annual Data & Insights Report 2024, which found that cryptocurrencies are the most commonly offered method of payment on commercial CSAM websites, with 60.87% of URLs that do not hide payment options enabling crypto transfers (or 518 out of 851 webpages).

In November 2022, the IWF published a report finding that CSAM websites accepting crypto payments had “doubled almost every year since 2015,” although with 1,014 such sites recorded in 2022, the figure doesn’t appear to have doubled since.

For Elliptic, partnering with the IWF to combat the spread of CSAM is one facet of its wider efforts to foster a safer digital ecosystem.

Giuseppe Fersini, Elliptic’s Head of Intel, told Decrypt that the firm is an “engaged member” of the IWF’s global alliance. “We support IWF’s vital mission not only through the integration of relevant data into our blockchain intelligence platform, but also through active participation in strategic discussions and knowledge-sharing around how payment systems, including cryptocurrencies, are exploited in the distribution of child sexual abuse material,” he added.

Privacy coins and crime

The past few years have witnessed an increase in CSAM websites making use of Monero and other privacy coins, according to a 2024 Chainalysis bulletin, which suggested that “Monero may be helping those CSAM vendors [which use Monero-friendly exchanges to] survive longer.”

Such usage raises a problem for organizations such as the IWF and Elliptic, which could potentially struggle to trace the flow of illicit crypto if more criminals use privacy tokens.

While acknowledging that such coins offer “ways to obscure the source and destination of funds,” Fersini also affirmed that they “are often only complementary to traceable assets” and may only be one element in a wider obfuscation strategy.

“This trend reinforces the need for advanced solutions and high-quality intelligence,” he adds. “Elliptic addresses this challenge by providing data capabilities that are asset-agnostic and optimized to detect patterns and connections even in the face of deliberate concealment.”

In terms of the future, the IWF is “looking to expand [its] Membership into the blockchain/crypto industry,” according to its Press Officer Cat McShane, who reminded Decrypt that blockchain analytics firm Chainalysis also works with the non-profit organization.

She says, “It is imperative that we disrupt the commercialization of CSAM as much as we can and having organizations like Elliptic on our side really aids this.”