This week, the cryptocurrency space’s most high-profile blockchain analysis company, Chainalysis, announced it had raised $30 million USD in a Series B fundraising round led by American venture capital firm Accel.
As part of the deal, Accel’s Phillippe Botteri will join Chainalysis’s Board of Directors. Benchmark, another American VC firm, bolstered its own investment into the blockchain investigator enterprise after having participated in the company’s $16 million Series A round last spring.
Chainalysis, which provides enterprise-grade blockchain investigation and compliance services, already maintains offices in New York and Copenhagen and will leverage the new Series B funding to open a third office in London, a sign of the firm’s growing operational ambitions.
“Although we’ve had feet on the ground in London for a while, we are excited to officially open an office there,” the Chainalysis team said in their announcement.
“As our second European office following Copenhagen, London will act as our hub for European business as well as anchoring our research. We will look to double our headcount there, tapping into London’s deep talent pool. The city is optimal for its proximity to top universities that increasingly recognize cryptocurrency as a technology poised to reshape the way people exchange value across the world.”
The latest fundraising round comes after Chainalysis expanded its services in 2018 even as other crypto companies were drawing down amid the year’s cryptoeconomy downturn. Last year the company launched its Know Your Transaction (KYT) system, a “real-time anti-money laundering compliance solution” that more than 100 enterprises now use.
That KYT system now offers coverage for top cryptocurrencies like bitcoin (BTC), bitcoin cash (BCH), ether (ETH), Litecoin (LTC). The company has said it also plans to use its new funding to expand product development around “new cryptocurrency usage.”
“We are focused on empowering new cryptocurrency use cases like stablecoins and supporting businesses and governments globally as cryptocurrency regulation becomes more defined,” Chainalysis CEO Michael Gronager noted in the wake of the Series B.
Crypto’s Top Investigators Turned to Stablecoins Last Month
In January, Chainalysis announced it had opened its KYT system’s coverage up to two rising stablecoin projects, Paxos and TrustToken.
The company said the expansion would allow users to monitor the covered stablecoins “across every transaction through their full lifecycle, including issuance and redemption.”
“The repeated knock against cryptocurrency is its volatility, and trust in stablecoins could lead the way to increased commercial use,” Chainalysis COO Jonathan Levin said on the news.
“Chainalysis KYT for stablecoins further supports this vision by raising the bar for accountability and providing compliance teams with the technology they need to meet AML requirements.”
As several new stablecoins have proliferated over the past two years, the name of the game now is for projects to win over users. Having coverage under the KYT system may give Paxos and TrustToken a further edge in transparency as the stablecoin rat race continues.
New Report Out in “Crypto Crime Series”
Chainalysis wouldn’t be locking down millions of dollars in investments if they weren’t good at blockchain analysis.
The investigatory firm put their skills to capable use in their latest Crypto Crime Series report, dubbed “Decoded Hacks,” which was released on January 28th.
In the report, the crypto detectives discerned that two as-yet unidentified groups were behind several major exchange hacks in the cryptocurrency ecosystem.
“Hacking dwarfs all other forms of crypto crime, and it is dominated by two prominent, professional hacking groups,” the authors said.
“Together, these two groups are responsible for stealing around $1 billion to date, at least 60% of all publicly reported hacks. And given the potential rewards, there’s no question hacking will continue; it is the most lucrative of all crypto crimes.”
So as hackers continue to make moves in the crypto space, Chainalysis is continuing to keep watch and securing the funding needed to do so.