- StarkWare quadruples valuation in six months
- Investors bet big on layer-2 solutions
StarkWare Industries, Ethereum (ETH) layer-2 scaling solutions developer, announced that it has raised $100 million, bringing its valuation to $8 billion from $2 billion. Six months ago, StarkWare raised $50 million in a Series C funding round led by Sequoia Capital.
The Series D was led by venture capital firm Greenoaks Capital and by investment management company Coatue. Tiger Global and other undisclosed investors participated as well. There is also a secondary transaction to the round, in which employees sell their stocks, according to the company.
StarWare’s latest funding takes place in the middle of a bear market and follows the crash of LUNA and TerraUSD (UST) cryptocurrencies. Despite this, StarkWare co-founder and chief executive officer Uri Kolodny said the raise was “a vote of confidence” in StarkWare’s tech stack.
StarkWare has established itself as a prominent Ethereum layer-2 scaling protocol and depends on its STARKs technology to reduce the amount of information sent to the Ethereum blockchain and alleviate blockchain congestion.
It recently launched its StarkNet Alpha 2 scaling solution. As a permissionless validity rollup, or zero-knowledge rollup, StarkNet uses basic compression technology to boost the production and security benefits of Ethereum layer-1 (L1).
According to Kolodny’s partner, Eli Ben-Sasson, co-founder and president at StarkWare, the goal is to make blockchain apps as mainstream as smartphone apps. “Anyone who ever built a website can use StarkNet to construct a blockchain app that will be part of the Web3 revolution, pioneering new and exciting uses for blockchain,” Ben-Sasson said.
StarkWare’s scaling engine, StarkEx, compresses transactions through STARKs before adding them to the Ethereum blockchain network. About half a trillion dollars have been reportedly traded on StarkEx.
For example, gaming company Immutable X, has been using StarkEx to mint its NFTs on Ethereum for the past two years. The StarkEx engine scaled up the throughput and reduced gas costs associated with NFT minting for its Gods Unchained blockchain game.
Immutable X announced on Wednesday that it will integrate building on the StarkNet protocol in order to become a cross-rollup liquidity platform for NFTs. This will enable players to directly trade any asset matched across multiple Ethereum layer-2 and layer-3 rollups, and facilitate projects migrating from L1 smart-contract based games to Immutable instantly.