The Great Crypto-Cop brain drain
During in a decade as a special agent with the US Internal Revenue Service (IRS), Tigran Gambaryan has seen them all.
From looted crypto exchange Mt Gox, to the dark marketplace Silk Road and the corrupt cops who steal their money, to the child pornography site Welcome to Video, to the scam involving the hacking of 130 VIP Twitter profiles, Gambaryan was the point of almost every major investigation involving bitcoin or cryptocurrency. “I’m a dinosaur in the crypto world,” he says. “When I started, Silk Road was one of the only places where you could spend bitcoins, other than buying pizza.”
Gambaryan had to learn to follow breadcrumbs on blockchains, the digital, obscure but public networks where cryptocurrencies like bitcoin and ether are traded.
Blockchain research was a new field, where the tools were initially few and rudimentary. At the same time, it was familiar terrain. “I was a financial investigator. My thing had always been “Follow the money,” says Gambaryan. Following that mantra, he would work his way to the weak link in a chain of transactions; often it was an account with a major cryptocurrency exchange, which in some cases could help him identify the suspect. “I was one of the first to start sending law enforcement requests to crypto exchanges,” says Gambaryan.
In 2021, the tables turned: He joined Binance, the world’s largest cryptocurrency exchange, as vice president of global intelligence and investigations. Gambaryan is now on the other side of the crypto fence, trying to spot bad behavior on the exchange and fielding requests from law enforcement around the world. Since joining Binance, he’s been busy trying to track down the people behind SQUID, a cryptocurrency scam named after — but unrelated to — Netflix’s blockbuster series Octopus game.
Gambaryan did not take the leap alone. He was just one member of a dream team of crypto-investigators Binance brought in from law enforcement in 2021, including Gambaryan’s IRS employee Matthew Price, former US Treasury investigator Greg Monahan, and Europol’s dark web boffin Nils Andersen-Röed. Another employee, Aron Akbiyikian, once worked as a digital crime-focused detective in Mariposa County, California. “There’s a bit of a brain drain going on,” says Gambaryan. “There is a massive exodus of special agent experts in cryptocurrency who have left government agencies and joined the cryptocurrency industry. All of them are basically gone.”
Predictably, some crypto rubbers have joined a burgeoning group of forensics companies, which combine proprietary digital tools and traditional investigative skills to help governments and companies with crypto-related investigations. That’s the case, for example, with Beth Bisbee, head of US investigations at Chainalysis, one of the leading outfits.
Until 2021, Bisbee was a cryptocurrency specialist for the Drug Enforcement Administration. But after helping the DEA grow blockchain research—and utilizing her case-breaking skills—Bisbee says her work began to feel “a little stagnant.” The DEA was focused on drug crimes, but she knew that crypto-bullying extended far beyond that sphere.
