Overview

Crypto tokens are stored on public ledgers, which record balances of tokens at different addresses (or "accounts"), and historical transactions. These can be browsed by anyone using blockchain explorers, but the ledgers do not record any information about the identity of people who own the balances or participate in the transactions.

If this privacy provision were removed, then holders of crypto tokens might be targeted by criminals, such as thieves and extortionists.

Arkham Intelligence provides a "blockchain intelligence" service that allows customers to specify a target person's identity, and obtain their private blockchain addresses.

Arkham boasts of a shocking feature that allows its customers to specify a person's public X (formerly Twitter) profile to obtain their private cryptocurrency addresses:

Arkham is ready to announce one of our most exciting features yet: Twitter search!

With only a Twitter handle, you can now search for anyone’s crypto trading activity across blockchains. pic.twitter.com/eXNsPOXOlT

— Arkham (@ArkhamIntel) February 22, 2023

Arkham's essential claim is that they are able to dox/deanonymize the owners of blockchain addresses using publicly available data.

They say this is made possible by sophisticated technology. They claim that the identities of those owning cryptocurrency on blockchains is revealed using artificial intelligence and machine learning:

Crypto intelligence technology - what we are building at Arkham - solves this problem.

Arkham aims to provide one comprehensive platform, using machine learning heuristics to generate a queryable database of categorized, deanonymized entities.

— Arkham (@ArkhamIntel) November 4, 2022

We were suspicious, not least because when Arkham first appeared, more than a year and a half before launching their service, it was to publish professional defamation they had created. Our Case #2 investigated the incident, and discovered their leaders had links to a cult and associated with a neo-nazi.

We were worried that something bad was happening behind the scenes, on an epic scale.

So we decided to investigate how Arkham links people to their cryptocurrency addresses, and explore other aspects of the organization.

A Conversation With Engineering

Introducing Kamil Szczerba

We introduce Kamil Szczerba, who worked as a software engineer at Arkham Intelligence between June and October 2022. He was instrumental in developing their API, their database code, financial charting systems, and their node graph visualizer and drag-and-drop dashboard.

We hope that his appearance on Crypto Leaks will provide some closure in relation to his experiences at Arkham.

Arkham's leaders demanded Kamil perfom a special task...

Creating beachhead accounts on Binance and FTX

When Kamil joined Arkham, he was soon asked to open accounts on the Binance and FTX cryptocurrency exchange platforms. Although these accounts were opened in his name, they were really for use by Arkham, and soon he was being asked to authorize various actions on his phone. He said he would do what Arkham wanted, as long as he didn't "end up in jail."

After a while, Kamil read Binance's terms and conditions, and saw that he was breaching them. He confronted the CTO, Henry Fisher, describing him as responding:

“	yes it could be interpreted in an illegal way ... but if he was in my shoes, he would do it anyway.

A security problem at Binance acts as a backdoor

Kamil explains that there was a security problem at Binance, which exposed a technical backdoor. This made it possible to de-anonymize blockchain addresses, for example to obtain the email of a person that was linked to a balance of bitcoin. The exploit involved sending a tiny amount of cryptocurrency through the platform.

So fruitful was the exploit, he says the Arkham team were terrified that Binance might fix the vulnerability involved, and so they worked through the night to extract information.

The full scale of what occurred, and over what period, remains known only to Arkham.

Arkham has advertised that they will be able to provide the private cryptocurrency addresses and transactions corresponding to the owners of arbitrary Twitter profiles. It is unknown whether the information gathered is already available via its public platform, or whether it is being used in conjuction with private consultancy services they provide.

We are optimistic that the scope of the de-anonymization is limited, because manual confirmations of actions were involved, preventing scripts being used to de-anonymize massive numbers of addresses (Binance has 128 million customers). Nonetheless, this is scant compensation for those individuals who have been targeted.

Kamil was increasingly worried, but they reassured him:

“	They told me that they would pay for the lawyers

Arkham stole personal data from FTX too

Arkham also found backdoor exploits on FTX, and extracted the personal data of its users, including information that would allow them to deanonymize transactions.

“	Yes ... he was gathering data.

Kamil backs out of the de-anonymization operation

Kamil became increasingly concerned, and decided to discuss matters with his wife. He decided to refuse to continue to play his role for two reasons: 1) his conscience, and 2) the legal risks that he was exposing his family to.

He spoke to Henry Fisher, the CTO of Arkham, to explain. Henry said he understood and admired Kamil's choice. Kamil said of Henry:

“	Maybe he was a bit ashamed.

The operation continues

Kamil closed his accounts. Henry Fisher said he would find another employee to open new accounts, so that the operation could continue.

Arkham People

Miguel Morel and Henry Fisher

Miguel Morel is Arkham's CEO, and Henry Fisher is its CTO. Both men hail from Paradigm Academy, which was spun out of a strange "productivity cult" called Leverage Research, based in Oakland, California. Miguel joined Paradigm Academy after high school at as an "entrepreneur-in-residence" at only 17 years old, as was first covered in the press by our own Case #2.

An ex-member of Leverage Research describes their experiences.

Arkham Intelligence first appeared to release professional defamation in June 2021, a year and a half before they had a blockchain intelligence platform to sell. At that time, Miguel Morel was its only known staff member, and historical information about both Miguel and the company was almost impossible to find on the internet. However, despite a lack of obvious credentials, Miguel is an extremely articulate individual.

Our Case #2 investigated Miguel and his associates at Arkham, and what was behind their production of defamatory material, concluding it was produced to order. We found that most of the team hails from the Reserve cryptocurrency project, and had links to the Leverage Research cult. A recent Protos investigation indicates that a hidden purpose of the Reserve cryptocurrency project was to funnel money back to Leverage Research.

After the defamation incident, which we believe was linked to the market manipulation of token prices, Arkham mysteriously appeared to come into significant money, and relocated the core team from a house in the countryside outside Austin, Texas, to a luxurious mansion in Chelsea, London, costing $43.5k per month. (Only one week after arriving in London, Miguel headed out on an extraordinary luxury shopping trip to Selfridges that was recorded on video by a London influencer, illustrating the vibe.)

They took the video down already but don’t worry I already saved it https://t.co/Y17bJmUDNR pic.twitter.com/CCHH7K8UIL

— David G 🏹 (@d_gilz) July 10, 2023

Tim Draper and Peter Thiel

Tim Draper remains on the board. Peter Thiel has left the board.

Cult-like Behavior, American Securities Law Violations, and other Unethical Behavior

An organization like Arkham does not usually violate norms in only one regard. We present evidence of cult-like management methods used inside the organization, possible securities law violations in the United States, which resulted in the departure of two senior executives they had hired, and ethics issues, including efforts to keep Kamil out of public sight.

See the APPENDIX for disturbing additional video and revelations.

What Must Now Happen

The accusations leveled in this Crypto Leaks case are very serious indeed. Users of Binance and FTX will want to know whether their private token addresses and transactions have already been doxed by Arkham, placing them at risk of fraud and extortion. Where exchange users have not already been doxed, they will wish to know how Arkham can be prevented from performing future doxings.

We assume only the best intentions of Arkham's investor board members and other investors. Now is perhaps the time for all responsible board members and investors to step in, and protect token holders and cryptocurrency users.

The Arkham platform could be taken offline while a thorough investigation is performed, to establish exactly what has occurred, and to remove information that has been obtained in breach of terms and conditions. Kamil Szczerba should be offered support and protection from parties that will now wish to silence him.

We hope that Binance, as a leading player in the blockchain ecosystem, can play a leading role in establishing exactly what has happened, and protecting users.

APPENDIX

Arkham Is Run Like a Cult

Introducing Sachin Dutta

Sachin Dutta was hired as Chief Growth Officer, and successful in the role. He was hired directly by Miguel Morel.

Loyalty, Obedience, Discipline

Given the strong links between the core Arkham team, and the Leverage Research cult, and that Miguel Morel himself entered their Paradigm Academy straight from high school, it's a reasonable question to ask whether elements of their past might persist in their management style.

Sachin Dutta reports that indeed, they run things in a strange way, and their leader, Miguel Morel has installed a plaque demanding three core values: loyalty, obedience and discipline:

“	they run things in a bit of a weird manner ... so the values in the house, it's loyalty, obedience, discipline

A valid question, is whether these values are necessary to install a code of silence regarding their activities. He goes on to say that:

“	so they run it like, some kind of a chapter

Accordingly, the core Arkham team in the mansion possibly believes that they are of a higher spiritual nature, which coincides with the teachings of Leverage Research, which tries to produce entrepreneurial supermen.

“	[they believe] that they are of the highest spiritual nature ... So they're ... a bit cult like

Possible Securities Violations

It appears that Sachin and another senior executive were forced out after a disagreement about securities law. Arkham's founding team wanted to send out an email to American retail investors, offering them free ARKM tokens, to encourage their participation in their upcoming token launch. Despite their protestations, they were forced to send out the emails.

“	That's the securities fraud ... both of us raised it

The other senior executive was John Kottlowski, who was Head of Sales, and based in New York.

John was being ordered to send out the emails, and he was extremely worried about the SEC. When he raised the issue, it caused a big furor with Miguel Morel.

This was the catalyst for Sachin being forced out. Later, Arkham realized that it was a compliance issue after all, so they fired the entire American team, including John — their plan, therefore, may involve staying outside the US to avoid the long arm of American regulators.

“	he was in New York, he was being ordered to send out emails ... it caused a big furor

The main concern was that:

“	the offer of the token ... fails the Howey test

John was instructed to do what he did. The emails went out.

“	it's a very top down approach that the CEO runs

John was left with the worry that:

“	the FBI were going to kick his door down

Other Unethical Behaviors

Arkham wished to separate Kamil from the outside world.

Kamil was not allowed a professional profile that revealed his work at Arkham:

“	they told me that they want to remove everything from my profile on LinkedIn

But they couldn't escape their own natures:

“	there were promises that were not kept

At some point, perhaps Arkham realized the imminent danger that Kamil leaving their orbit might cause, and they suddenly reduced his hours and increased his salary — but it was too late.

“	Yes it's strange, because after one month they increased my salary and reduced my hours, because they assumed that I would leave

Another Arkham Engineer

Naturally, one would hope that an organization such as Arkham, which is handling important financial information, would be careful in their approach to engineering. After all, the doxing functionality of their platform might wrongly assign a crypto balance or transactions to the wrong person, causing them great problems with tax authorities, for example.

We interviewed another Arkham engineer, Jean Guillaume Brasier, to get a sense of how they approached things.

“	kind of a dodgy team, to be fair

There wasn't much testing.

“	And I'm like, okay, but you haven't tested anything.

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