1.Introduction to Arkham

Arkham is a cryptocurrency analysis platform and data tracking dashboard tailored to facilitate easy monitoring of on-chain activities for various blockchain entities. This platform provides extensive market analysis, transactional data, and thorough reviews of cryptocurrency projects.

Users can search by name for individuals, funds, exchanges, and ENS addresses to overview their recent activities, or delve into specific addresses for detailed insights. This data is invaluable for making trading decisions, predicting trends, managing risks, and detecting early threats, thus helping investors, researchers, and cryptocurrency enthusiasts gain a deeper understanding of market dynamics, spot investment opportunities, and monitor the performance of their crypto assets.

Arkham’s mission is to enhance transparency by making data that was once only available to blockchain analysts and enthusiasts accessible to all, thereby leveling the playing field for cryptocurrency traders and enthusiasts. It employs artificial intelligence to gather, organize, and present a vast array of on-chain data via its dashboard. Its advanced AI address matching engine, called Ultra, can automatically associate on-chain addresses with real-world identities.

Furthermore, Arkham introduces a token system that enables users to offer Arkham (ARKM) tokens as bounties on the Arkham Intel Exchange marketplace for specific on-chain data intelligence, like identifying the owner of a wallet address. On-chain data analysts holding valuable information can market this data to interested parties for bidding. This transactional data remains exclusive to the buyer for up to 90 days before becoming public.

2. Core mechanism

Arkham operates primarily as a cryptocurrency analysis platform with its core mechanisms focused on data collection, processing, analysis, and presentation.

A crucial component of this system is Arkham Intelligence. The organization has developed a proprietary AI-driven address matching engine known as Ultra. This engine is capable of extracting intelligence from the extensive network of current activities. It effectively manages both on-chain and off-chain data from various sources across multiple blockchains. By linking blockchain addresses to real-world entities, it provides a comprehensive view of the entities engaged in cryptocurrency transactions and their associated activities.

Purpose and Features of Ultra：

• Deanonymize: The main purpose of Ultra is to overcome the anonymity inherent in blockchain transactions. While blockchain transactions are public, they are often represented by anonymous addresses, which makes it difficult to understand the entities behind these transactions. Ultra systematically processes this data to identify and reveal the real-world entities behind blockchain addresses, such as individuals, companies, or institutions.
• Data synthesis: Ultra collects and synthesizes on-chain and off-chain data from multiple sources. This process involves collecting transaction history, wallet addresses, token movements, and other relevant data points on different blockchain networks.
• Artificial Intelligence Analysis: Utilizing advanced artificial intelligence and machine learning algorithms, Ultra analyzes collected data to find patterns, connections, and identifiers that can link anonymous blockchain addresses to identifiable entities. This may involve analyzing transaction behavior, network interactions, and other digital footprints entities leave on the blockchain.

Key Features and Benefits of Ultra :

• Accuracy and scalability: One of Ultra’s key features is its ability to efficiently handle large amounts of data, maintaining a high level of accuracy when matching addresses to entities. This scalability is crucial given the widespread and growing nature of blockchain databases.
• real-time data processing: Ultra is designed to run in real time, delivering the latest insights and intelligence. This feature is critical for users who rely on timely information to make trading decisions, assess risk, or conduct research.
• Comprehensive blockchain coverage: While many analytics platforms may focus on a single blockchain, Ultra’s design allows it to aggregate and analyze data across multiple blockchain networks. This multi-chain approach ensures a more comprehensive understanding of the blockchain ecosystem, reflecting the interconnected nature of today’s cryptocurrency market.
• Enhanced market insights: By de-anonymizing blockchain addresses, Ultra provides users with deeper insights into market dynamics. Understanding the actions and strategies of the major players in the cryptocurrency space can provide significant advantages in trading, investing, and risk management.

In addition, Profiler is also the core platform supporting Arkham products. It acts as a central hub for accessing detailed insights into blockchain participants’ transaction history, asset holdings, financial performance and interaction patterns. By aggregating and presenting a wide range of data points, Profiler enables users to conduct in-depth analysis of entities, thereby enhancing their ability to make informed decisions, conduct research, or monitor market movements.

Profiler’s Main Functions:

• transaction history: Users can view the complete transaction history of an entity or address, including incoming and outgoing transactions. This history can be filtered and sorted based on various criteria such as USD value, specific coins, counterparties and time frames, providing a detailed understanding of trading behavior.
• Portfolio holdings: Analyzer displays the current portfolio holdings of an entity or address, broken down by individual assets. It provides insights into asset distribution, concentration, and exposure to specific cryptocurrencies.

• Balance History: Users can track the historical balance of an entity or address over time. This feature helps understand how an entity’s total asset value evolves, highlighting periods of significant accumulation or disinvestment.

• Profit and Loss: By analyzing transactions and portfolio changes, Profiler can estimate the profit and loss of an entity or address. This estimate is critical to evaluating financial performance and the effectiveness of investment strategies.
• Exchange Use: This tool provides data on entities or addresses interacting with exchanges, detailing deposit and withdrawal activity. This information is critical to understanding an entity’s liquidity management and risk exposure.

• Main Counterparty: It identifies and lists the primary counterparties with which an entity or address transacts. This insight is valuable for uncovering relationships and networks within the blockchain ecosystem.

Advantages of Profiler:

• A comprehensive analysis of: By consolidating various data points into a single interface, Profiler allows users to conduct a thorough analysis of an entity or address without having to access multiple tools or platforms.
• Real-time insights: The real-time nature of Profiler data ensures users have access to the latest information, allowing them to react quickly to market changes or new developments.
• Strategic Decision: With detailed transaction history and financial performance data, users can better understand the strategies employed by entities on the blockchain. This understanding can inform their own investment decisions, risk assessments and research efforts.
• market transparency: Profiler helps increase market transparency by making it easier to analyze the actions and positions of blockchain participants. This transparency levels the playing field for market participants and creates a healthier trading environment.
• Customization and alerts: Users can customize their views and set alerts for specific activities or thresholds, making Profiler a versatile tool tailored to individual analytics needs and preferences.

Meanwhile, filtering capabilities allow users to sort and navigate results based on specific metrics, simplifying the task of finding the data they need.

Additionally, Arkham Intel Exchange is an innovative component of Arkham Intelligence that serves as a decentralized marketplace for buying and selling crypto-related intelligence. The platform utilizes native token ARKM as a medium of exchange, facilitating the exchange of actionable insights and data between users. Arkham Intel Exchange aims to democratize valuable crypto intelligence, opening it up not only to large institutions with significant resources, but also to individual traders and analysts.

Functions and Features of Arkham Intel Exchange:

• Decentralized information market: The exchange operates in a decentralized model, allowing users to interact directly without the need for a central authority. This setup promotes transparency and fairness while reducing the risks associated with centralized platforms.
• Bounty system for intelligence requests: Users seeking specific intelligence can post a bounty on an exchange, specifying the information they require and the amount of ARKM they are willing to pay. Other users can then fulfill these requests to earn bounties. The system incentivizes the collection and sharing of targeted intelligence.
• information auction: Users with valuable crypto intelligence can auction it off to the highest bidder. This feature enables individuals with unique insights, data, or analysis to effectively monetize their knowledge.
• Intel-to-Earn model: The exchange has introduced an Intel-to-earn model to reward users for their contributions to the ecosystem. Whether by fulfilling bounty requests or participating in auctions, contributors can earn ARKM tokens, encouraging active participation and continued growth of the platform’s intelligence pool.
• Smart contract-based transactions: All transactions on Arkham Intel Exchange, including bounties and auctions, are conducted through smart contracts. This approach ensures transparency, security, and trust because the terms are enforced programmatically and cannot be tampered with.
• Exclusive access period:Purchased Intelligence is initially available exclusively to the Buyer for a predetermined period and may thereafter be made publicly available on the Arkham Platform. This period of exclusivity allows buyers to maximize the value of the intelligence they receive.

Arkham Intel Exchange Impact and Benefits：

• Improve market efficiency: By facilitating the exchange of intelligence, the Arkham Intel Exchange helps make more informed decisions across the crypto market. This, in turn, can increase efficiency and reduce information asymmetries.
• Empowerment of individual participants: The platform levels the playing field by providing individual traders and analysts with high-quality intelligence previously only available to well-resourced entities.
• Incentives for knowledge sharing: Through a reward system, the exchange encourages users to share their insights and analysis, thereby creating a collaborative environment with freer access to information.
• Enhance transparency and trust: The decentralized nature of the exchange combined with the use of smart contracts enhances trust among participants. Users can participate with confidence, knowing that the platform’s mechanisms ensure fairness and transparency.

3. ARKM

The ARKM token is a core element in the Arkham Intelligence ecosystem, designed to facilitate the acquisition, sharing and trading of crypto intelligence. As a native token, ARKM plays a vital role on the Arkham Intel Exchange, not only as a medium of exchange, but also promoting the formation of an intelligence-centered decentralized economic system.

Functions of ARKM token:

• Information Trading:ARKM tokens are used for buying and selling cryptocurrency-related intelligence on the Arkham Intel Exchange. Users can use ARKM to post intelligence bounties or purchase intelligence shared by others.
• Incentives:The Arkham ecosystem encourages users to share valuable intelligence through the intel-to-earn model. Users are rewarded with ARKM tokens by providing intelligence, completing bounties, or selling intelligence in intelligence auctions.
• Governance:ARKM token holders may participate in platform governance decisions, such as voting on platform updates, intelligence verification standards, and bounty policies.
• transaction fee:When conducting transactions on the Arkham Intel Exchange, ARKM tokens may be used to pay related fees, including but not limited to bounty publishing fees, transaction fees, or other possible platform service fees.

Features of ARKM token:

• Decentralization:As a blockchain-based token, ARKM supports decentralized transactions and economic activities, reducing dependence on centralized exchanges and improving transaction security and transparency.
• Community driven:The design of ARKM encourages community members to actively participate in the development of the platform and jointly shape the future of the Arkham ecosystem by sharing high-quality intelligence, voting decisions, etc.
• Transparency and security:The smart contract-based transaction mechanism ensures the transparency and security of ARKM transactions. All transactions are recorded on the blockchain and can be publicly verified, reducing the risk of fraud.

The total amount of ARKM is 1 billion, distributed as follows: 37.3%: used to maintain the ecosystem; 20%: reserved for core contributors; 17.5%: reserved for investors; 17.2%: used as foundation funds; 5%: Used as Binance Launchpad; 3%: reserved for advisors.

The initial circulation of tokens is 15%, and all tokens will be circulated after seven years. The tokens of investors, core contributors, and consultants will be locked within one year of launch, and will be gradually unlocked in the next three years. The total unlocking period for ecosystem tokens is five years, and the unlocking period for foundation funds is seven years.

As of now, the price of ARKM token is $2.24, the market capitalization is $459,060,903, the ranking is #175, and the trading volume / market capitalization ratio is 10.06%. This ratio is higher, which may indicate greater trading activity in the market, or a price change. It was found that there were large fluctuations in the process. If the entire supply of ARKM tokens were accounted for at current prices, the market cap would be approximately $2,243,699,429.

4. Team/Financing Situation

Arkham was founded in 2020 by Miguel Morel, who is also one of the co-founders of the algorithmic stablecoin project Reserve Protocol and currently serves as the CEO of Arkham.

According to Arkham’s official website, they received more than $12 million in Series A financing. Investors include one of the anonymous founders of OpenAI, which created the 2023 artificial intelligence craze product ChatGPT, Joe Lonsdale, co-founder of Palantir, and venture capital firms Industry elites such as Geoff Lewis, founder of Bedrock, Tim Draper, founder of Draper Fisher Jurvetson, etc.

So far, Arkham’s strategic partners include: Base, BNB Chain, Polygon, Optimism, etc. By establishing key strategic partnerships with these well-known companies, Arkham expands its reach into the Ethereum blockchain and beyond.

5. Advantages and Controversies

Arkham’s analytics products have played a prominent role in solving high-profile crypto incidents in the past.

• Asset recovery for Alameda Research Corporation

Arkham Intelligence found that the liquidator tasked with recovering assets after the collapse of hedge fund Alameda Research had taken control of 34.94 Bitcoin (BTC), worth about $110 million at the time, Bitcoin Magazine reported. Arkham reports indicate that as of March 2023, multiple wallets have been receiving BTC from exchanges and cold wallets.

• Euler hacker funds gradually withdrawn

In April 2023, Arkham Intelligence was able to track the gradual return of approximately $200 million stolen by hackers from lending protocol Euler Finance, Coin Desk reported. Analysis revealed that the vulnerability exploited a combination of dai (DAI), Wrapped Bitcoin (wBTC), staked Ethereum (sETH), and USD Coin (USDC). Arkham’s analysis was used to monitor the batch returns of funds as Euler and the hackers negotiated a solution.

But along with the good news, Arkham has also generated some controversy.

• User email was exposed with invitation code link

Arkham previously launched a recommendation function that allows users to invite others to join Arkham through a generated invitation code link. However, after Arkham announced the airdrop on July 10, some netizens posted on Twitter that they found that the code of the invitation link could be easily deciphered, exposing the user’s email address, causing dissatisfaction in the cryptocurrency community.

These codes are generated by Base64 encoding the user’s email. As long as you use a free online tool to reverse decode, you can see the email address of the recommender. This allows many netizens who publicly post code links through social media platforms to have their email addresses virtually invisible.

After the incident, Miguel Morel explained on Twitter that the system linked to the code was created during a beta test of the system to allow them to reward users with their email addresses for helping promote the campaign. The company does not use emails for other purposes except sending communication emails and giving rewards through email addresses. In addition, when the recommended user first opens the link, they will also be able to see the email of the inviter. This is to let them know that the inviter is a real Arkham user.

However, Morel admits that as the user base grows, it will be necessary to change the way they generate links. They have updated the mechanism so that all generated links will encrypt the user’s email and cannot be deduced in reverse.

• Accused of invading user privacy by making money through human flesh search

A major feature of the currency circle has always been anonymity, but Arkham has always advocated “de-anonymization” and mentioned in the white paper that “unprocessed and anonymous raw transaction data is useless” before launching the service with the above functions. . However, the Arkham Intel Exchange platform, which allows users to buy and sell information, has also attracted criticism from many privacy-conscious cryptocurrency users who oppose the use of “human flesh search” to make money.

Mark Zeller, founder of AAVE Dao, said on Twitter: “Human flesh search is not cool. I am very disappointed with your junk coin that betrays the entire ecological value. This will bring a lot of harm.”

Cryptocurrency investment blogger Scott Melker also opposed the idea that the Arkham project is reasonable and ethical on his Twitter account called The Wolf Of All Streets, believing that the currency circle should move in a more privacy-focused direction instead of going backwards. Go in the opposite direction.

However, there is another view that this feature of Arkham can help combat common hacking problems in the currency circle. According to a report by Chain Analysis, as much as $3.8 billion was stolen from cryptocurrency investors in 2022, setting a record high.

• Suspected ties to U.S. government

One of Arkham’s investors is Joe Lonsdale, co-founder of big data company Palantir. Since one of Palantir’s major customers is the US government department, and Palantir assists them in anti-terrorism work, the Arkham project is also suspected to be related to the CIA or other government units, raising suspicions of privacy violations.

Arkham denied the relevant claims in a statement, emphasizing that it is not a secret project of the US government and has no involvement with government agencies.

6. Analysis of future development

As an early adopter of crypto intelligence technology and an innovator in the space, Arkham is well-positioned to benefit from the growth of the crypto intelligence space, building on experience while new entrants carve out market positions.

If global cryptocurrency adoption does occur, intelligence could become a force for competitive advantage. Users have access to increasingly sophisticated and creative insights tools that help them make smarter decisions on trade entry and exit, asset selection, identifying patterns, and more. At the same time, exchanges and other platforms can more deeply integrate crypto intelligence into their functionality as a strategy to attract traders with more attractive products.

Approaching growth from a cybersecurity perspective, many believe that mass cryptocurrency adoption will bring with it a greater need for rock-solid security. Of course, if transparency is leveraged to deter malicious behavior, new applications of cryptographic intelligence could provide better security for everyone.

All in all, although Arkham is a potential platform that can be used to help track hacker information, it is not difficult to understand that this is not good news for the big players in the currency circle, so it can be said to be a double-sided sword. It’s too early to tell if Arkham will have much of an impact on the industry, only time will tell.

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