Chainalysis acquires Israeli blockchain security startup Hexagate in $60M deal
Chainalysis acquires Israeli blockchain security startup Hexagate in $60M deal
The Israeli company, which was founded less than three years ago, is credited with saving $1B.
Blockchain giant Chainalysis has acquired the Israeli company Hexagate, a developer of security solutions for Web 3.0 and blockchain. This marks Chainalysis’ first acquisition in Israel. The companies did not reveal the value of the deal, but it is estimated to be in the region of $60 million.
The company, which specializes in blockchain analytics, operational intelligence, and data access, employs approximately 900 people globally and serves financial institutions, governments, and law enforcement agencies. Following the acquisition, Hexagate will continue its current operations, and all 20 of its employees—who are based in Israel—will remain in their roles.
Hexagate was founded in 2022 by CEO Yaniv Nissenboim and CTO Niv Yehezkel. The company raised $8.6 million in a Seed funding round led by Entrée Capital, with participation from Samsung Next, INT3, North First Ventures, and entrepreneurs from companies like Vdoo and Medigate, where the founders previously worked.
Yaniv Nissenboim served in the Israel Defense Forces' Cyber Unit before becoming a cyber consultant for other security agencies. Transitioning to the private sector, he founded Scientra, a startup in the algo-trading space, and later co-founded Jumper Labs, which developed virtual testing systems for IoT products. Nissenboim subsequently joined Vdoo, a cybersecurity company acquired by JFrog.
Niv Yehezkel, a veteran of Unit 8200, began exploring cybersecurity at the age of 14. After his military service, he joined Medigate as one of its first employees; the company was later sold to Claroty.
Nissenboim explained the origins of Hexagate: "After Vdoo was acquired by JFrog, I returned to entrepreneurship and met Niv through a mutual friend. After a few months of collaboration, we decided to focus on blockchain security. We realized the blockchain space is highly vulnerable, with billions of dollars in thefts occurring easily. With our combined knowledge and experience, we believed we could tackle the toughest challenges in the field. During our research, Niv discovered a $5 billion vulnerability in the Polygon blockchain network, and that’s when we knew we had something significant."
Yehezkel elaborated on Hexagate’s capabilities: "The structure of blockchain networks allows us to detect early signs of theft before they materialize, using machine learning. Thanks to our efforts, the number of successful hacks has decreased compared to previous years. Blockchain is a highly technical and complex field, so we built a team of world-class experts with decades of cybersecurity experience. Together, we created a platform that operates in real time and supports the majority of blockchain networks at scale."
Hexagate closed its $8.6 million Seed round in May 2022 during a challenging market environment. "The market wasn’t ready to adopt blockchain security products at the time," Nissenboim noted. "However, by April 2023, we began generating revenue, and within a year, we achieved an ARR of several million dollars. Our clients include industry leaders like Coinbase, Polygon, EigenLayer, Uniswap, and Consensys, and we’ve helped save over $1 billion through timely threat alerts. We’ve also gained global recognition for achievements such as discovering a vulnerability in the Ledger hardware wallet."
While Hexagate could have sustained its growth independently, the team chose to join forces with Chainalysis. "Our alignment with Chainalysis, the leading global player in blockchain security with an extensive client portfolio and partnerships with governments, presents an incredible opportunity," Nissenboim said. "This acquisition allows us to accelerate our mission of preventing blockchain-based theft on a global scale."
