Payments giant PayPal and investment management firm Galaxy joined hands to raise $20 million in seed funding for Chaos Labs, a New York-based cloud platform for securing blockchains and protocols.
Chaos Labs protects crypto protocols against external exploits and risks with an automated risk management platform. The platform does this by offering agent- and scenario-based simulations, which in turn, helps secure protocols against economic vulnerabilities and market manipulation events.
The seed funding is aimed at helping Chaos Labs further automate on-chain risk optimization.
1/ We are thrilled to announce we have secured $20M in seed funding led by @galaxyhq and @PayPal to automate on-chain risk optimization! pic.twitter.com/gVnarbmFSk
– omer (@omeragoldberg) February 21, 2023
The funding round saw participation from 23 organizations and six angel investors. Prominent names among the lot include Coinbase Ventures, Polygon, Avalanche, OpenSea UniSwap and Balaji Srinivasan.
Participants of Chaos Labs’ seed funding. Source: Chaos Labs
According to Chaos Labs’ CEO and Founder, Omer Goldberg, there is a need to upgrade financial risk management catering to the decentralized finance (DeFi) ecosystems. He added:
“We believe that every DeFi protocol must regularly conduct robust risk testing to verify and validate that their economic system is secure against hackers and unanticipated volatility.”
The official website states that Chaos Labs’ risk suite can help protect DeFi protocols through optimized risk and capital efficiency, streamlined risk assessments and streamlined risk assessments.
Related: MetaMask to allow users to purchase and transfer Ethereum via PayPal
PayPal’s interest in the crypto ecosystem was highlighted when it was found holding a significant part of its financial liabilities in cryptocurrencies offered to its customers.
As Cointelegraph reported, by the end of 2022, PayPal held a total of $604 million in various cryptocurrencies, including Bitcoin (BTC), Ether (ETH), Litecoin (LTC) and Bitcoin Cash (BCH). The information was found on the annual report filed with the United States Securities and Exchange Commission on Feb. 10.
Out of the lot, Bitcoin accounts for $291 million in the firm’s asset breakdown, while $250 million is held in ETH. The remaining $63 million includes Litecoin and Bitcoin Cash combined.