MPC Wallet Fordefi Raises $10M Funding to Enhance Crypto Security for Retail-Facing Platforms

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MPC Wallet Fordefi Raises M Funding to Enhance Crypto Security for Retail-Facing Platforms

Published: February 13, 2024 at 12:10 pm Updated: February 13, 2024 at 12:10 pm

Edited and fact-checked:
February 13, 2024 at 12:10 pm

In Brief

Fordefi raised $10 million funding to expand the reach of its MPC crypto wallet for retail-facing trading and fintech platforms.

MPC Wallet Fordefi Raises $10 Million to Enhance Crypto Security for Retail-Facing Platforms

Multi-party computation (MPC) wallet Fordefi raised $10 million in financing in its recent funding round led by Electric Capital, Paxos and Alchemy. The company plans to use the newly acquired funds to expand the reach of its self-hosted MPC wallet by integrating the product into retail-facing platforms, including trading platforms and fintech platforms.

The MPC technology divides a single private key among multiple parties, eliminating a single point of failure. Thus, MPC wallets are more resistant to hacking attempts, contributing to a reduced risk when interacting with decentralized finance (DeFi) applications, according to Josh Schwartz, CEO and co-founder of Fordefi.

The company is expanding its services by introducing a wallet-as-a-service product tailored for retail-facing platforms, including exchanges, fintech platforms, and Web3 businesses. This initiative aims to provide these platforms with the capability to integrate self-custodial wallets directly into their applications, offering users greater control and ownership over their digital assets within the platforms.

“Fordefi changes the game for safe institutional access to DeFi and crypto by providing novel tools around MPC, user policies, and transaction simulation. Their new wallet-as-a-service offering extends their industry-leading technology to any business wanting their customers to have the best mix of security and user experience to get on-chain,” said Curtis Spencer, co-founder and general partner at Electric Capital, in a written statement.

The new investment followed the company’s $18 million seed capital raise in November 2022. Notable participants in the funding round included Lightspeed Ventures, Pantera Capital, Jump Crypto, Electric Capital, Alameda Research, Castle Island, Illuminate Financial, PayPal Alumni Fund, Nima Capital, Digital Currency Group, Defiance Capital, StarkWare, and several others.

Fordefi has successfully brought on board institutional investors, including Pantera Capital, DeFiance Capital, Keyrock, and Flare Network, to adopt its wallet. Notably, the company’s wallet has facilitated over $3 billion in blockchain transaction volume, highlighting its growing traction and adoption in the market.

Rising Preference for MPC Wallets Marks a Turning Point in Crypto Security

MPC wallets have become increasingly favoured in the cryptocurrency space for their heightened security, particularly in comparison to alternative storage methods like cold storage, hot storage, and hardware wallets. This surge in popularity comes in the wake of significant financial losses experienced by cryptocurrency investors over the past few years in exploits on DeFi applications or in situations where they lost access to their digital assets on platforms that encountered setbacks, such as cryptocurrency exchange FTX.

Recently, a cryptocurrency exchange and derivatives platform Bitget introduced its own wallet service incorporating multiparty computation (MPC) technology, aiming to enhance security measures and improve key management for users accessing the platform.

Fordefi’s recent investment and focus on providing retail-facing platforms with enhanced security position it at the forefront of revolutionizing security and user experience in the rapidly evolving landscape of cryptocurrency and decentralized finance.

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About The Author

Alisa is a reporter for the Metaverse Post. She focuses on investments, AI, metaverse, and everything related to Web3. Alisa has a degree in Business of Art and expertise in Art & Tech. She has developed her passion for journalism through writing for VCs, notable crypto projects, and scientific writing. You can contact her at [email protected]