Israeli startup Starkware, which develops solutions for enlarging blockchain capacity, today announced that the completion of a $75 million financing round led by Paradigm and with the participation of existing investors Sequoia and Funders Fund, DCVC, Pantera and Wing and new investors Three Arrows and Alameda Research.
This brings to $111 million the amount raisedby the company in addition to $12 million it received from the Etherium Foundation. Vitalik Buterin, one of the founders of Etherium, has previously invested in the company.
Starkware was founded at the beginning of 2018 by president Eli Ben-Sasson, CEO Uri Kolodny, chief architect Michael Riabzev and chief scientist Alessandro Chiesa. Ben-Sasson and Riabzev came from the Technion, Israel Institute of Technology, Chiesa from the University of California, Berkeley and Kolodny is a tech entrepreneur.
Starkware was founded on the basis of research into zero knowledge proofs (ZKP) conducted by Ben-Sasson and Riabzev at the Technion. ZKP can provide solutions to problems of overloading and privacy on blockchain networks.
Starkware's application StarkE can scale-up blockchain network capacity 1,000 fold or even more using mathematical methods. The application serves as a platform for trading and issuing digital assets such as NFTs. Starkware is currently developing StarkNet, an open network that will allow scaling up capacity for all blockchain developers. The company's beta version will be available for developers later this year. The company's system is built around the Cairo language, which was created by the company's researchers and engineers.
According to Ben-Sasson, the company's technology will make the issuing NFTs significantly cheaper. A non-fungible token (NFT) is a unit of data on a digital ledger called a blockchain, where each NFT can represent a unique digital item, and thus they are not interchangeable. NFTs can represent digital files such as art, audio, videos, items in video games and other forms of creative work. Ben-Sasson said, "Instead of each NFT costing $40 to issue, we can cut that to one third of a cent because we have made the process more efficient and faster."
The Technion was at loggerheads with Ben-Sasson, a professor at the university and his student Riabzev for working "in the dark" by setting up a company based on research they had been conducting at the Technion for many years. Last year the parties reached a settlement and Ben-Sasson left the Technion.
Kolodny said that the latest financing round would enable the company to hire talented developers and product personnel.
Published by Globes, Israel business news - en.globes.co.il - on March 25, 2021
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