A startup cybersecurity company based in New York City has announced its collaboration with Europol's European Cybercrime Center. The announcement, made on Thursday, will enable Chainalysis to tap onto distributed ledgers in order to track digital identities.

As reported by Business Insider, the agreement between the two companies comes as a memorandum of understanding in digital currencies. As more and more people are getting into the bitcoin currency, it has also become a potential for competitors to establish its own online payment mechanism. In the process, it also is a target for criminals to conduct extortion and fraud.

On Finextra, Chainalysis' chief executive, Michael Gronager, has been quoted "This new collaboration is an important next step in the endeavor to move digital currencies out of the hands of the criminals and into the hands of consumers and blooming commerce."

The collaboration between the two companies seem to be a response to Europol's report last year of how cyber crime has started to become a large business. Because of that, criminals have started to take advantage of cloud infrastructure with bitcoin, as its most widely used way of extorting money from their victims.

Coindesk reports that Chainalysis targets to fight cyber crime by keeping track of digital identities linked with digital currencies. Thanks to the company's dedicated software, they will be able to detect any suspicious activity right away. The software also serves as an investigative tool that law officials can use.

Chainalysis is a company that specializes in countering money laundering and fraud particularly in the digital currency industry. The company has separately raised $1.6 million in funding led by a Berlin-based early-stage venture capital firm called, Point Nine Capital. With the growing number of companies in the bitcoin and blockchain industry, companies like Techstars, Digital Currency Group, Converge Venture Partners, and FundersClub can get the help they need to secure their transactions.