Blockchain analysis firm Chainalysis has completed a $30 million Series B round led by American VC firm Accel and Benchmark, who led the startup’s Series A funding in April 2018. Accel partner Philippe Botteri will also join the firm’s board of directors.
The fund injection will be used to expand the startup’s operations including its Chainalysis Know-Your-Transaction (KYT) tool which allows more than 100 crypto exchanges and financial institutions to vet their clients.
The analytics firm known for investigating the Mt. Gox case will open a new office in London, its second office in Europe, which will serve as a base devoted to research and development.
Chainalysis provides bitcoin transaction analysis to crypto exchanges, law enforcement agencies and other private clients to help them identify illicit transactions on the blockchain. Per a Diar report, Chainalysis was singled out as the preferred blockchain forensics contractor for the U.S. government, receiving $5.3 million from government agencies.
The New York-based startup was founded in 2014, and it has now raised $47.6 million, suggesting that investors are still investing in crypto businesses despite the slump in prices.
Speaking with Fortune, Chainalysis CEO Michael Gronager said the company’s target audience had seen a gradual shift from what it was a year ago. According to Gronager, the company made the bulk of its money from law enforcement agencies — approximately 90 percent of its revenue — which has fallen to 40 percent. Corporate clients now make up the lion’s share of its revenue streams.
One reason for this is the rise of stablecoins which has continued to prop up an industry that has been hit by the longest bear market in its history. Chainalysis has been benefiting from the fast-rising stablecoin sector, whose adoption grew based on the increasing number of on-chain transactions.
“Born out of the ashes of this was the stablecoin as another way to easily and safely create tokens. This ability to trade U.S. dollars against crypto is very powerful,” Gronager noted in the interview.
According to Gronager, the firm hasn’t turned in a profit, but it has grown three times since its Series A.
While Chainalysis is quite visible in the crypto analysis sector, Elementus is a competitor that is gradually making a name for itself. The analytics firm was pivotal in reporting the actual figures stolen in the Cryptopia hack.