Two years ago, Co-founder of Chainalysis, Jonathan Levin appeared before the US financial services committee and testified that Chainalysis had managed to track around 650,000 stolen Bitcoins from Mt Gox, the biggest crypto exchange at that time. Chainalysis performed an investigation and discovered Bitcoin of worth $1.2 billion.
In the same year, Chainalysis discovered that its software could be used by banks and crypto exchanges to abide by anti-money laundering rules.
Jonathan Levin informed Forbes in an article, Chainalysis is currently assisting banks to understand how they can develop programs to enable digital currency businesses to access banking services, simultaneously also ensuring that there are no illegal activities taking place.
The crypto forensics firm was founded in 2014 by Levin, Michael Gronager and Jan Moller. The company received its first revenue by helping law enforcement by identifying illegal digital currency transactions.
Levin also mentioned that the company introduced a new tool, developed to support money processors and legacy banks to meet regulatory requirements automatically, for instance validating the source of customer’s funds as they widely open accounts for crypto firms.
The new business application greatly helped the company to earn revenue worth $8 million in 2018 and has around $53 million in venture funding from Benchmark and Accel. This helped the company to be named in Forbes ‘Next Billion-Dollar Startups’ list. Chainalysis is the foremost cryptocurrency firm to make an entry in the Forbes list.
As per a Chainalysis report, crypto hackers earned around $1 billion in 2018 hacking exchange incident.
Bitcoin and other altcoin owners avoided almost $25 billion in paying US taxes, Fundstrat Global Advisors reports.
Chainalysis is now divided into two parts, one part offers services to track illegal activities, and the other one offers crypto services. Levi mentions half of the revenue is earned by working with state government and regulators. It also works with the Internal Revenue Service and the Federal Bureau of Investigation to offer investigation software product.
The Chainalysis tool is used across 35 countries by 110 clients.
Chainalysis Software Used by organizations
Chainalysis software is used by the Bank of Montreal to probe human trafficking. Europol also uses the software to locate and protect online crime. The United Nations Office on Drugs and Crime has also used the software to tackle child abuse.
Barclays uses the tool to help validate crypto-based firms as account owners.
Levin also mentioned that Chainalysis has managed to track USD 1.1 million transferred to crypto addresses linked to the circulation of millions of pictures of child abuse; this information helped officials to detain 300 plus people.
Both the services of Chainalysis, namely crime-fighting and compliance, are operated throughout the world; around 160 people are working at New York, London, and Copenhagen and Washington DC offices.
“We are spending a lot more time thinking about how corporations, social networks, and financial institutions are going to be able to safely enter the space.”