Chainalysis is a blockchain analysis company providing compliance and investigation software to the world’s leading banks, businesses, and governments.^[1][37]

In November 2020, Chainalysis raised $100 million at over $1 billion valuation to expand the global regulatory platform for the surging cryptocurrency market.

This Series C round was led by Addition, with participation from previous investors including Accel, Benchmark, and Ribbit Capital.^[33][34]

Chainalysis was founded in 2014.

They started by building software to understand Mt. Gox's bankruptcy filings and analyze how they lost hundreds of thousands of Bitcoin. Chainalysis CEO and founder Michael Gronager explained:

Chainalysis also works with banks to help them prevent cyber-crimes.

By 2015, the Chainalysis team was enrolled in Barclays’s first-ever Barclays Accelerator program, powered by Techstars.^[9]

On April 5, 2018, Chainalysis raised $16 million in Series A funding from Benchmark. In addition to receiving funding on April 5, Benchmark's general partner Sarah Tavel joined Chainalysis's board of directors. ^[2]

In February 2019, Chainalysis raised $30 million in Series B funding.

The round was led by VC firm Accel and included additional investments from Benchmark. Accel’s investment was led by Amit Kumar and Philippe Botteri, and Botteri joined Chainalysis' board of directors.^[11] The venture funding arm of Japan's largest bank, Mitsubishi UFJ Financial Group, announced in April 2019 that it had invested $6 million in Chainalysis Series B funding round, bringing the round's total to $36 million.^[12]

In July 2019, Chainalysis became the first blockchain company to be listed on Forbes's "Next Billion-Dollar Startups List."^[13][38]

Seeking the on-ramp to what Maddie Kennedy, Chainalysis’s director of communications, called a "path to profitability," Chainalysis announced on November 21, 2019, that it was laying off 39 employees, about 20 percent of its workforce.

After the reduction, Chainalysis's total headcount was 155.^[14]

In July 2020, Chainalysis raised $13 million from Ribbit Capital and Sound Ventures, increasing its Series B fundraising round to $49 million.^[16] Donald Trump’s former sanctions chief, Sigal Mandelker, joined Chainalysis’s advisory board as part of the Series B investment.^[36]

In October 2020, Chainalysis revealed via a blog post that the company's revenue grew 100 percent year-over-year in Q3 of 2020.

The company said that this was largely due to its customers growing by 65 percent in that period.

The majority of these customers were national governments, who enlisted Chainalysis to provide blockchain analytics support to cybercrime investigations.

The same month, Chainalysis also announced new hires, including Amanda Wick, former Financial Crimes Enforcement Network and United States Department of Justice official, and Don Spies, former United States Department of the Treasury official, as its new director of market development.^[17] Due to its success in 2019 and 2020, Chainalysis began expanding, announcing the opening of two new offices in Tokyo and Singapore.^[18]

Targeting government and law enforcement agencies, the company announced in November 2020 that it had launched a service for handling, monitoring and ultimately disposing of the crypto assets they seize.

The new service was offered in partnership with Asset Reality, a consulting firm that specializes in asset realization services for public and private sector clients.^[19]

In November 2020, Chainalysis raised $100 million at over $1 billion valuation to expand the global regulatory platform for the surging cryptocurrency market.

This Series C round was led by Addition, with participation from previous investors including Accel, Benchmark, and Ribbit Capital.^[33][34] As part of the investment, the company that currently employs 200 people plans to nearly double its staff over the next year, including hires in international policy, sales and marketing and research and development.^[36]

An early customer of Chainalysis, Kraken, the major U.S.-based cryptocurrency trading platform, contracted with Chainalysis to aid in its efforts to find the bitcoin lost in the Mt. Gox hack in 2014.^[20] In 2017, Chainalysis co-founder Jonathan Levin testified before United States Congress that Chainalysis had found 650,000 of the missing bitcoin stolen from Mt. Gox.^[21]

In May 2019, a study published by Chainalysis revealed that one-third of the total supply of Ether, the native cryptocurrency of the Ethereum platform, was held by just 376 people worldwide.^[22]

In August 2019, Chainalysis announced the launch of a new software product called Chainalysis Know Your Transaction (KYT), which gives alerts to users of cryptocurrency trading platforms when it detects suspicious crypto transactions.

This product is an anti-money laundering (AML) product primarily for cryptocurrency trading firms and financial institutions. Alert levels include Severe, High, Medium, and Low, and are based on factors such as category, service, direct versus indirect exposure, the direction of funds, and amount. Alerts are available for all 15 cryptocurrencies supported by Chainalysis, including Bitcoin, Ether, Bitcoin Cash, Litecoin, and top stablecoins and ERC-20 tokens such as Tether, Maker, and Dai, with additional cryptocurrencies coming soon.^[23]

In January 2020, Chainalysis published a report saying that Bitcoin's use for buying illegal products was growing, with over $600 million worth of Bitcoin was spent in darknet markets during Q4 of 2019. Chainalysis also found that Bitcoin's use in darknet markets is "less influenced by the highs and lows of its price."^[24][25]

The company released its review of the 2019 cryptocurrency crime on January 29, 2020.

According to Chainanlysis, $11.5 billion worth of cryptocurrency transactions were associated with criminal activity in 2019.

The single type of crime that the company found accounting for the largest percentage of crime-related transfers were two Ponzi schemes.^[26]

In July 2020, the Twitter accounts of several high-profile public figures - including Barack Obama, Elon Musk, and Bill Gates - were hacked in a massive cryptocurrency giveaway scam involving an organization named, "Crypto For Health." The Twitter handles of exchanges like Gemini, Coinbase, and Binance, as well as prominent figures in the digital asset world like Justin Sun, were also hijacked in this 2020 Twitter Hack. Many of the hacked accounts posted the same announcement: “I am giving back to my fans. All Bitcoin sent to my address below will be sent back doubled.” Others, like the account of President Joe Biden, posted messages that said more or less the same thing worded differently.^[27]

The day after the attack, Chainalysis told CoinDesk that the BTC amassed during this scam was "on the move." Chainalysis said it had identified and was monitoring four wallets into which the stolen BTC was transferred.^[28]

Chainalysis KYT (Know Your Transaction) combines industry-leading blockchain intelligence, an easy-to-use interface, and a real-time API to reduce manual workflows while helping cryptocurrency businesses comply with local and global regulations.

KYT detects many patterns of risky activity, from darknet markets and scams to sanctioned addresses and anomalous transactions.

KYT covers 90% of all cryptocurrency activity.

A customer can use the real-time KYT API to prevent withdrawals to blacklisted addresses and freeze deposits from hacks, scams, and ransomware.^[29]

Reactor is the investigation software that connects cryptocurrency transactions to real-world entities, enabling a user to combat criminal activity on the blockchain.

A user is able to enter any cryptocurrency address to learn which entity controls the wallet and discover related addresses.

Chainalysis Reactor’s intuitive interface allows users with minimal training to create powerful visualizations of cryptocurrency flows.^[30]

Chainalysis Kryptos provides complete profiles of cryptocurrency businesses based on KYC details and the industry's most trusted blockchain data.

Service profiles combine on-chain and off-chain data such as location, KYC policies, counterparties, and news.^[31]

Chainalysis identified 2,000+ unique services that together control millions of cryptocurrency addresses accounting for over $1 trillion of value transferred.

Over 100 new services are added every week, a third of which are scams, darknet markets, and other illicit services.

Chainalysis acts as the common link between cryptocurrency businesses, banks, and law enforcement agencies around the world.

Chainalysis offers a comprehensive profile for each service that includes physical address, top counterparties, legal jurisdiction, KYC policies, and supported currencies.^[32]