StarkWare, an Ethereum scaling startup that utilizes ZK-rollup technology, has quadrupled its valuation to $8 billion after raising $100 million in a Series D funding round.
Greenoaks Capital and Coatue led the round, Israel-based StarkWare announced on Wednesday. Other existing and new investors also backed the round, including Tiger Global. The funding also had a secondary component, meaning StarkWare's employees were able to sell shares.
StarkWare's valuation has surged sharply in the past six months, despite the recent souring of sentiment following the Terra blockchain's collapse. Last November, the firm was valued at $2 billion when it raised $50 million in Series C funding. In March, the Israeli newspaper Calcalist reported that StarkWare was hoping to raise at least $100 million at a $6 billion valuation.
When asked what led to the jump in valuation, StarkWare co-founder and CEO Uri Kolodny told The Block in an interview that both developer and investor communities are realizing that StarkWare is offering "the most comprehensive, most powerful, most battle-hardened, most future-proof solution to scale blockchain and that triggers a considerable amount of interest in being part of StarkWare."
StarkWare closed the round last week after Terra's dramatic unwind, noted Kolodny.
Founded in 2017, StarkWare offers two key products: StarkEx and StarkNet. The former is a permissioned tailor-made Ethereum scaling engine and the latter is a permissionless decentralized ZK-rollup that supports independent deployment of smart contracts. The idea behind Ethereum scaling networks is to increase the number of transactions on the network and reduce gas fees.
Several crypto projects use StarkWare's technology, including dYdX, Sorare and Immutable. Kolodny said the firm looks to further expand its ecosystem with new funding in place.
"This round will allow us to expand our effort in product development, engineering and business development and grow our ecosystem around StarkEx and StarkNet," said Kolodny.
To that end, StarkWare also plans to expand its team by hiring "dozens" of people this year, said Kolodny.
The Series D round brings StarkWare's total funding to date to $262 million. Kolodny declined to comment when asked if StarkWare is looking to launch its own native token.
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