Crypto wallet firm Fordefi raised $10 million in venture capital investment, aiming to solve one of the biggest pain points in crypto by expanding its institutional-focused wallet offering to retail-facing platforms, the company told CoinDesk in an exclusive interview.
The fundraising was led by Electric Capital, with Paxos and Alchemy joining as new investors. The investment followed a $18 million seed capital raise in November 2022 with Lightspeed Ventures, Pantera Capital, and Jump Crypto, among others.
Crypto investors, including retail and institutional, suffered billions of dollars in losses over the past years in exploits on decentralized finance (DeFi) applications or losing access to their digital assets held on platforms that imploded such as FTX.
Fordefi aims to make crypto safer with its self-custodial wallet with multi-party computation (MPC) that divides a single private key among multiple parties, eliminating a single point of failure, Josh Schwartz, CEO and co-founder of Fordefi, explained in an interview. MPC wallets are harder to hack and make interaction with DeFi apps less risky.
Read more: MPC Explained: The Bold New Vision for Securing Crypto Money
The company has already onboarded institutional investors such as Pantera Capital, DeFiance Capital, Keyrock, and Flare Network to its MPC wallet and secured over $3 billion in blockchain transaction volume.
Now, Fordefi is extending a wallet-as-a-service product to retail-facing platforms such as exchanges, fintech platforms and Web3 businesses to offer user-owned (self-custodial) wallets directly within their applications.
“Fordefi changes the game for safe institutional access to DeFi and crypto by providing novel tools around MPC, user policies, and transaction simulation,” Curtis Spencer, co-founder and general partner at Electric Capital, said in a statement. “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.”