Chainalysis has closed a $16 million Series A led by Benchmark. Sarah Tavel, a Benchmark general partner, took a seat on the board. The company builds software for exchanges, banks, and law enforceme
Chainalysis has closed a $16 million Series A led by Benchmark. Sarah Tavel, a Benchmark general partner, took a seat on the board.
The company builds software for exchanges, banks, and law enforcement to investigate cryptocurrency transactions and catch fraud and money laundering. Chainalysis traced the missing Mt. Gox bitcoins and its software contributed to at least one criminal arrest, according to CEO and co-founder Michael Gronager. The IRS has relied on Chainalysis tools to identify Bitcoin users dodging taxes on their gains.
Chainalysis maintains data on 25% of all Bitcoin addresses. The company's information accounts for half of all Bitcoin transaction volume. Chainalysis has analyzed more than $15 billion in transactions and counts Barclays among its customers.
Previously, clients could only examine transactions after they occurred. The company launched Chainalysis KYT, a new real-time analysis product, today. The tool flags transactions as they move through exchanges, categorizing their purpose in real time and feeding results into the exchange's processing system. Compliance teams use a dashboard to spot high-risk customers and file reports on suspicious activity.
Early testers cut the time needed to review accounts by a factor of 20. "We've opened KYT to a small group of early customers, and they have already seen a 20x improvement in the speed of account reviews," Chainalysis said. "We're excited to officially open this solution to exchanges and financial institutions everywhere, which represent the fastest growing segment of our business today."
Chainalysis is also broadening support beyond Bitcoin. The company is first adding Bitcoin Cash to Reactor, its investigation platform, with access limited to law enforcement and government customers. Chainalysis plans to support at least ten cryptocurrencies before the year closes, with both Reactor and KYT including all supported currencies.
