Wednesday, July 6, 2022

Chainalysis raises $170M to expand its crypto fraud detection platform

Today, blockchain data platform Chainalysis announced it has raised $170 million as part of a Series F funding round led by Singapore’s sovereign wealth fund GIC. The funding values ​​the organization at $8.6 billion and will allow it to invest in enhancing its crypto fraud detection platform and expanding its global presence.

Chainalysis’ platform provides automated transaction monitoring, risk management and business intelligence analysis for cryptocurrency exchanges, corporations and government agencies, which they can use to detect cryptocurrency fraud and money laundering.

For organizations, using blockchain analytics and transaction monitoring can improve visibility into cryptocurrency transactions so that cryptocurrency businesses can identify criminal activity, block transactions, and comply with necessary regulations.

Spotting Fraud in a Decentralized Economy

The announcement comes as researchers estimate that the global blockchain market will grow from $4.67 billion in 2021 to $163.83 billion in 2029, driven by the Covid-19 pandemic and rapid advances in digital ledger technology.

“Over the past year, the cryptocurrency industry has entered the mainstream as financial institutions enter the cryptocurrency industry and new technologies such as NFTs disrupt traditional markets,” said Michael Gronager, co-founder and CEO of Chainalysis.

As consumers and businesses increasingly adopt cryptocurrencies, cryptocurrency providers and businesses face increasing pressure from regulators and investors alike to crack down on fraud.

Chainalysis’ answer to spotting fraud in an increasingly fragmented economy is to provide blockchain analytics so businesses can better understand how customers are using cryptocurrencies, which not only helps identify fraudsters, but also provides insights on how to enhance the customer experience .

Top Blockchain Analytics Providers

Chainalysis, one of the fastest-growing blockchain monitoring solutions on the market, now screens an average of $1 trillion worth of cryptocurrency transactions per month, and has hired over 450 new employees in the past year, bringing its total to 700.

However, the group isn’t the only provider using analytics to help exchanges and businesses identify crypto fraud.

One of the group’s main competitors is Elliptic, a blockchain analytics provider that monitors more than 500 crypto assets for signs of fraudulent activity. The group recently raised $60 million as part of a Series C funding round and claims that 66% of the total cryptocurrency volume is through exchanges using Elliptic.

Another competitor is digital asset and risk management provider TRM Labs, which monitors crypto transactions through cross-chain analysis, enabling users to monitor the movement of funds from one cryptocurrency to another, such as from bitcoin to ethereum or another blockchain.

TRM, which supports over 900,000 digital assets across 23 blockchains, recently announced that it has raised $60 million in a Series B round in December 2021.

At this point, Chainalysis aims to differentiate itself from these providers by expanding the datasets used by its smart solutions.

For example, the organization recently expanded its coverage to support DeFi identification, which includes 100% coverage of the top 15 DEX liquidity pools, while also covering lending and oracle protocols and yield aggregators.

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