Background Checks in the Cryptocurrency Sector and $20M Investments: How Molfar Helps Large Companies Find Professionals

We share with you another working case: this time, the results of our work are, without exaggeration, estimated at tens of millions of dollars. Our client is a large cryptocurrency exchange. We will not say the name of the company, but it is not difficult to guess. The client is satisfied with the result of the work, and now Molfar has another loyal customer of regular research.

What was the task, and how was it done?

This is a background check for hiring and due diligence to understand all the risks involved. The task was completed in three stages.

Preamble

The cryptocurrency exchange wanted to take two new people to the board of directors, these two people had to become the main driving factors in the development of a new development strategy, for the implementation of which the cryptocurrency exchange wanted to attract generous investments.

At the beginning of the research, we received 20 names – this is a list of candidates that the company considered for a position on the board of directors.

The first stage

Molfar specialists conducted a surface analysis of all 20 people. As always, we worked in a team led by a person with expert experience in the field of crypto technologies, in particular cryptographic engineering. This is the first stage of the background check.

The second stage

After collecting the information, the team specialist, together with the team leader and HR, conducted an expert assessment of the candidates for the positions. For evaluation, a table of five criteria was developed, according to which each candidate was given points from 1 to 10. Accordingly, candidates with a total score from 35 to 50 points were recommended for the position. At this stage, the due diligence for the assessment of professional risks during employment is completed.

After checking the evaluation results by the board of directors, three people were left. Then the Molfar specialists faced the task of doing an in-depth review of the persons and background check to finalize the decision regarding the job invitation.

The third stage

An in-depth study of three people. The board of directors of cryptocurrency exchange considers people mostly based on their financial results. So foremost we analyzed the career of each of the candidates and the financial results that were achieved while holding all the positions. For this, an analyst specializing in financial management joined the team.

An important point: checking the reputation of candidates. When the research was completed, the reputation of only one of the three candidates was in question. All things being equal, he might have had a better chance of getting the position, but a background check revealed problems and legal proceedings related to interactions with creditors and investors that occurred in one of the former positions. In addition, the file was sent to Molfar lawyers for fact-checking, they confirmed: this court case concerns fraud on a particularly large scale, accepting the position of the candidate is associated with great financial risks in the future. Such a conclusion was made despite the closing of the court case by agreement of the parties, after which all claims against the candidate were removed.

We passed the results of the study along with expert assessments and a legal opinion to our customer – the board of directors of the cryptocurrency exchange. They took our warnings into account, and made a job offer to two candidates with a "clean" reputation, after reviewing their successes in previous positions.

The candidates accepted the offer, and soon began to develop a new strategic concept for the development of the cryptocurrency exchange. This could be the end of the story, but 6 months after these events, the head of the company of directors of the cryptocurrency exchange called us and expressed his verbal thanks for the work. According to him, the team of directors developed a strategy that was liked by several large investors at the presentation, which in total made it possible to attract $20m of investment for the development of the company.