Company News

Introducing Chainalysis KYT, Multi-currency support and our Series A

Blockchains are trust machines.

Blockchains create new ways for people to build trust among themselves and transact using cryptocurrencies. Cryptocurrencies have in turn inspired people to reimagine the financial machinery that powers world commerce. People are collecting land in virtual realities, conducting real-time payments for computation services and buying collectible cats on the internet. This is just the beginning of worldwide access to financial instruments. However, to realize this vision, trust in both the technology and between all relevant stakeholders is a requirement. Exchanges, token platforms and governance structures are some of the most important motors and cogs in these machines. The oil in these machines is the transparency that serves the most relevant data to every participant. Chainalysis produces the oil that gets these cogs turning.

With machines, it is not often that you get to look under the hood…

When we started Chainalysis in 2014, the connection between the cogs of the financial sector and Bitcoin were grinding together. There was a lot of interest inside banks to get involved in cryptocurrencies but there was no way to put compliance controls in place to meet regulatory obligations for Anti-Money Laundering. We built investigation software that could help cryptocurrency businesses explain to banks the source and destination of customers’ Bitcoin funds. This received massive traction over the last four years, permitting banks like Barclays to offer services to companies like Circle and Coinbase. However, as with oil, it can be refined further and reapplied.

To that end, today we are launching a new product called Chainalysis KYT (Know Your Transaction). Anti-Money Laundering compliance is centered around understanding the purpose behind a single transaction or a collection of transactions done by the same user. Chainalysis KYT provides real-time feedback on the underlying purpose of transactions and feeds that feedback into exchanges’ transaction processing engines. Compliance personnel use our dashboard to generate alerts on risky customers and export suspicious activity reports. We have opened KYT to a small group of early customers, and they have already seen a 20x improvement in the speed of account reviews. We’re excited to officially open this solution to exchanges and financial institutions everywhere, which represent the fastest growing segment of our business today.

2018 is also the year that we are introducing multi-currency support. At Chainalysis, we focus every effort on supporting the greatest economic outcomes for world commerce. Today that means looking beyond Bitcoin. To start, we are launching Bitcoin Cash as part of Reactor, our investigation software, for our law enforcement and government customers, and we plan to expand to at least 10 cryptocurrencies by the end of the year. We think of the different blockchains that power different cryptocurrencies as all part of the same machine. Both Reactor and Chainalysis KYT will feature all the cryptocurrencies that we support this year.

Lastly, we are proud to announce we have additional firepower to help Chainalysis continue to grow and build this future. We have raised a Series A of $16m from Benchmark and general partner Sarah Tavel is joining our board. Our expanding team of over 75 people across offices in New York, Washington D.C. and Copenhagen is working tirelessly behind the scenes to provide the necessary data that every stakeholder needs to bring us all closer to realizing the ultimate goal of empowering people to transact in ways that they could never have imagined.