Miner Extractable Value infrastructure provider Skip Protocol has raised $6.5 million in a seed round led by Bain Capital Crypto.
Galaxy Digital, Robot Ventures and Jump Crypto are also among the investors also participating in the round, according to a company release on Thursday.
Miner Extractable Value (MEV) is a strategy where miners and validators have found ways to profit from including, excluding or ordering transactions within blocks to be validated. Pending transactions are held in a public area called a “mempool” before being selected for within the block.
Founded in 2022 by Barry Plunkett and Maghnus Mareneck, Skip aims to democratize access to MEV opportunities and profits on the Cosmos blockchain ecosystem and other emerging proof-of-stake ecosystems, according to the release.
Cosmos is a Layer 1 blockchain on which apps and services are connected by the inter-blockchain communication protocol (IBC).
“The presence of toxic forms of MEV, including spam and latency wars, have capped the financial upside and harmed the user experience of those who build on and invest in them,” said Plunkett, Skip's co-CEO. “Skip’s goal is to give chains and their communities a toolkit that allows them to decide how MEV is extracted and where profits accrue.”
How does Skip protocol work?
Skip’s technology enables users and traders to pay for transaction prioritization and privacy in sealed-bid auctions, according to the release. It is designed to make it easier for traders to execute their strategies while sharing MEV profits among validators, stakers and protocols.
“The Cosmos ecosystem is currently exploring a new portion of the design space of decentralized protocols via application-specific blockchains — and Skip is greatly expanding the value and type of MEV in the marketplace,” said Tarun Chitra, managing partner at Robot Ventures, in the release.
“The Skip team has a very unique background that combines academic mechanism design research and practical software engineering that allows them to improve the efficiency of the Cosmos ecosystem in the same way that MEV auctions improved Ethereum,” he added.
In May, Skip finished in first place at Jump Crypto/Terra hackerhouse event, per the release.
The average deal size for blockchain projects at the seed level has declined for four straight months through July, before rebounding in August, according to funding data from The Block Research.
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