Crypto-native risk monitoring and market surveillance company Solidus Labs announced on Monday the completion of a $20 million series A funding round, led by Evolution Equity Partners. Additional participating investors include Hanaco Ventures, which led Solidus Labs’ seed funding round in early 2019, 645 Ventures, leading crypto exchange FTX, and Avon Ventures, a venture capital fund affiliated with FMR LLC, the parent company of Fidelity Investments.
This funding round also includes angel investors with vast regulatory, compliance, capital markets, and cybersecurity experience. These participants include former CFTC Chair Christopher Giancarlo, former SEC Commissioner Troy Paredes, former CFTC Chief Innovation Officer Daniel Gorfine, StarCompliance Founder Marc Epstein, International Securities Exchange Founder David Krell, AngelList Founder Naval Ravikant, SecurityScorecard Founders Sam Kassoumeh and Aleksandr Yampolskiy, serial entrepreneur Jeff Fagnan, and Takoma Group Founder Alex Acree.
The Israeli-founded and New York-based firm seeks to transform financial risk monitoring, beginning with the new challenges posed by crypto and digital asset markets. Solidus’ clientele includes world-leading crypto firms as well as traditional financial institutions and regulatory agencies. The firm reported a 400% increase in inbound demand for its solutions in 2020, including a 10X spike in interest from banks and traditional financial institutions.
“Crypto and digital assets aren’t just transforming financial services, they’re also driving a major transformation in how capital markets, and finance as a whole, will be regulated,” said Asaf Meir, Solidus Labs’ founder, and CEO. “As both innovators and regulators strive to harness these new technologies and make finance more accessible, transparent, and efficient, crypto has also exposed the soft underbelly of legacy risk monitoring solutions, which Solidus Labs addresses.”
Meir noted that the company plans to significantly expand its Tel Aviv and London R&D offices in order to address the demand for its solutions, as well as to grow its sales, regulatory affairs, and product teams. Solidus Labs also intends to open offices in East Asia and other high-demand markets.
In a study published in March, Citigroup named Solidus Labs a category-definer for crypto market surveillance. Meir founded the company in 2018 with CTO Praveen Kumar and COO Chen Arad, bringing together a team of former Goldman Sachs engineers and cybersecurity veterans to bridge the regulatory, risk, and compliance gap between crypto and digital assets and the traditional financial world.
“We’ve been deeply impressed with Solidus’ ability to unify multiple financial risk data sources, and process them more effectively than ever before to detect anomalies and concerns,” said Richard Sewald, Founder and Managing Partner at Evolution Equity Partners, which is leading the investment round. “Any solution that effectively addresses the risk challenges in digital assets will become the future of financial risk monitoring. Solidus is very well positioned, and has the right tech, brand, team, and network to achieve this.”