Chainalysis to slash 15% of staff in second round of layoffs

abdelaziz Fathi

Chainalysis, a New York-based blockchain analytics firm, has laid off 15% of its workforce, marking its second round of job cuts in the past 12 months.

The company, which specializes in analyzing and tracking cryptocurrency transactions for risk-management purposes, previously laid off 5% of its staff in February.

This move comes as the crypto market experiences a bearish trend, reducing the demand for commercial products and services. Earlier in the year, in February, Chainalysis axed around 40–50 employees as part of a reorganization in response to challenging market conditions. Prior to these layoffs, the company had roughly 900 employees.

“While Chainalysis continues to be well positioned for long-term success as a consistently top-performing software company, we are very focused on growing efficiently and, due to market conditions, believe it necessary to reduce our expenses at this time. We remain committed to our mission to build trust in blockchains among government agencies, financial institutions, and cryptocurrency businesses,” the company said in a statement.

The startup, which has offices in New York, Washington DC, Copenhagen, Singapore and Tokyo provides financial institutions, cryptocurrency exchanges and law enforcement with a platform to detect and investigate cryptocurrency money laundering, fraud and compliance violations.

Additionally, Chainalysis is selling its bitcoin-tracing technology and compliance software to banks and brokers to monitor and link digital identities to cryptocurrencies. Its team of data scientists and programmers are leveraging a wide range of quantitative data sources, including exchanges and blockchain data sources, to clarify and present the view of the cryptocurrency and blockchain ecosystem.

US authorities disclosed earlier that they leveraged Chainalysis investigative assistance to seize more than $1 billion worth of bitcoin associated with Silk Road, the shady dark web marketplace that it took offline in 2013.

Chainalysis raised $170 million last year in a Series F funding round that values it at $8.6 billion. The decent valuation came less than two years after the NYC-based company first attained the ‘unicorn’ title back in November 2020.

Chainalysis isn’t alone in dealing with the effects of crypto’s collapse. Many other platforms slashed hundreds of jobs amid huge withdrawals and regulatory scrutiny after the implosion of FTX. The cuts were also prompted by macroeconomic and geopolitical factors, which muted customer demand, lowered trading volumes and cut sign-ups.

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