Mriganka Pattnaik of Merkle Science: Why Criminals Are Crypto's Best Trend Indicator

When Mriganka Pattnaik first joined crypto exchange Luno in Singapore, he experienced what he calls "the $60 million shock." Day after day, he watched elderly victims lose life-changing sums to scammers operating with impunity across blockchain networks. The pattern was relentless and predictable.

"When you first come in, you are shocked that this 60 year old person lost $50 million in crypto to a hack. Over time you realize that it just literally happens almost every other day."

That daily horror show became the genesis of Merkle Science, the blockchain analytics company Mriganka co-founded in 2018. While crypto's attention economy celebrated DeFi protocols and NFT launches, he chose the unglamorous infrastructure business: building compliance tools that could actually stop the bleeding.

Seven years later, Merkle Science monitors 125+ blockchains covering 97% of the top 100 cryptocurrencies by market cap. The company has raised over $25M and earned Mriganka a spot on Forbes 30 Under 30 Asia in 2020. But the story he tells isn't one of victory. It's a cat-and-mouse game where the criminals consistently move faster than the good guys.

Criminals as Canaries: Following the Money to Predict Trends

Mriganka offers a counterintuitive insight that makes traders and analysts pay attention: criminals are crypto's canary in the coal mine. When illicit actors flood into a particular blockchain or token, mainstream adoption isn't far behind.

"Criminal activity tends to go first to the areas of crypto that are starting to become big. So for analysts or traders, that's an indicator that this coin is starting to gain mainstream adoption."

Right now, that indicator is flashing red on USDT Tether, specifically on the Tron network. Stablecoins have become the preferred vehicle for illicit transactions because they solve the criminal's fundamental problem: price volatility. When you're moving millions across borders, the last thing you want is a 15% price swing mid-transit.

Why Tron specifically? Mriganka points to a compliance gap. While Circle, which issues USDC, implemented strict compliance procedures early, Tether took a more permissive approach. Combined with Tron's lower fees and faster settlement, it created the perfect storm for criminal adoption.

The second major vector is cross-chain bridging. As the crypto ecosystem fragments across dozens of chains, criminals exploit the gaps between them. Moving funds from Ethereum to an obscure Layer 2, then bridging to Tron, and finally converting to USDT creates enough complexity to slow down investigators. Not every blockchain has the same level of monitoring, and those blind spots are where criminals operate.

The North Korea Problem and the 10% Challenge

If there's a final boss in crypto crime, it's North Korea. Mriganka describes DPRK hackers as operating at a different level entirely. They're not just stealing funds, they're building infrastructure.

"We've seen instances where DPRK has tried to set up small exchanges that are just going to be nested exchanges and try to launder money in that fashion as well."

These aren't amateur operations. North Korean hackers run full-scale projects with resources that dwarf most DeFi protocols' security budgets. They study behavioral patterns that flag suspicious activity, then engineer their transactions to avoid detection. When one avenue gets blocked, they pivot to the next innovation in crypto infrastructure.

Merkle Science's answer is behavioral analytics. Rather than just flagging known bad actors, the platform looks for patterns that indicate criminal activity: the age of an address, transaction frequency, amounts, timing, and other parameters.

"Using like four to 10 different parameters, you can still filter out 80 to 90% of threat or attack vectors very easily."

But Mriganka admits the final 10%, the truly sophisticated criminals like DPRK actors, remain a challenge. The next frontier is combining on-chain data with off-chain signals: IP addresses, device fingerprints, UI interaction patterns. This is where PayPal built its patent fortress in traditional finance, and where Merkle Science is heading for crypto.

The technical constraint? Most DeFi protocols can't freeze transactions by design. Unlike stablecoins, which have built-in freeze functions, DeFi protocols prioritize permissionless operation. That means monitoring and reporting become the only defensive tools available.

The Privacy Paradox: Surveillance That Drives Adoption

Mriganka navigates the libertarian critique carefully. He acknowledges the tension between surveillance and crypto's founding principles, but draws a pragmatic line.

His argument: compliance monitoring actually drives adoption. When Metamask and Sui Protocol implemented criminal activity screening, they didn't lose users. They gained credibility with institutions and regulators, which unlocked the next wave of growth.

Why New York Beat Singapore

Two and a half years ago, Mriganka made the strategic decision to relocate from Singapore to New York. The move reflected a broader thesis about where crypto innovation concentrates.

"Most of the activity tends to happen in the US first and then the other markets follow, both in the government space and in the private sector and the best tech talent is also here."

Within the US, he chose New York over San Francisco based on a clear geographical division. San Francisco builds crypto protocols and AI infrastructure. New York builds financial compliance and institutional bridges. For a company selling to banks and government agencies, the choice was obvious. New York also offered something unexpected: a public sector willing to collaborate with early-stage startups. The FBI runs events specifically to scout new compliance technology, even from six-month-old companies.

Merkle Science competes against Chainalysis, which peaked at an $8.6B valuation in 2022 (though it has since declined significantly), and other established players like Elliptic and TRM Labs. Mriganka's bet is that blockchain analytics will follow the Palantir playbook: intelligence as infrastructure that scales with the entire industry's growth.

As Bitcoin ETFs pull Wall Street into crypto and tokenized real-world assets blur the lines between TradFi and DeFi, compliance stops being optional. It becomes the gateway that institutions must pass through. Mriganka isn't building a consumer app that needs viral growth but building the pipes that make institutional adoption possible.