Tech venture studio MPCH Labs has announced it raised $40 million in a Series A round to develop the next generation of multi-party computation (MPC) technology.
The fundraising round is led by Liberty City Ventures and includes other backers including trading firms QCP Capital and LedgerPrime, as well as VC players such as Animoca, Human Capital and Oak HC FT, according to a company release on Tuesday.
What is MPC?
Multi-party computation (MPC) enables multiple parties to collectively come together to do a computation without ever revealing the private data each holds. The technology is often used in self-custody solutions where multiple devices can validate a transaction removing the potential for a single point of failure.
MPCH’s co-founder and CEO Miles Parry came across MPC technology running an institutional custodial business called Vo1t. The company eventually got acquired by the trading firm Genesis and is now known today as Genesis custody.
“I've gathered a lot of experience through the marketplace, especially in traditional as well as the crypto space and as I saw the pitfalls, [I] actually decided instead of trying to adapt the existing MPC solutions out there, I'm going to build it from the ground up,” said Parry, who co-founded MPCH alongside Cat Le-Huy, the startup’s chief technology and product officer.
Emerging from stealth
MPCH emerges from stealth with a total of $50 million in funding and more than 80 employees. The studio has developed the MPC6 engine, which is a new MPC solution that is designed to be more secure than the traditional MPC architecture and can be adopted by multiple industries, Parry said.
MPC6 is built not only for crypto, but also to be agile. It can be adopted by big institutions as well as by a small startup, Parry said.
MPC6 contains six layers that work together. The layers are a hybrid of web2 and web3 technology stacks, which include distributed identities, hardware security modules (HSMs), public key infrastructure (PKIs), Intel Software Guard Extensions and zero-knowledge proofs.
The layers mean that clients aren’t held hostage, Parry said. They can pick and choose which layers they want to host on.
The Fraction app
Most of the new funding will go towards MPCH’s first product called Fraction, which will launch later this year. Fraction leverages the MPC6 engine to create a toolkit for institutions to self-manage digital assets, wallets and workflows, per the release.
The Block Research’s August funding recap showed that infrastructure plays were the second most popular category for early-stage deals. The average Series A check size in August was $18 million, according to the report.
“There’s no doubt in my mind that in five years more institutions will hold more tokens,” said Adam Winnick, founding partner of Medici Network and Finality Capital Partners, in the release. “Fraction has the best MPC-technology solution to help make that happen.”
Institutions can grant access to one or a set of wallets to multiple users, all while maintaining the security of their assets in a user-friendly environment, according to the release.
The first customers for the product will be crypto native firms, market makers, funds and asset managers, Parry said. Eventually it should be accessible enough for even an everyday consumer.
“We have zero knowledge and zero control of their assets,” Parry said. “We've built this carefully to ensure that the clients are completely covered and have control of assets.”
The white paper for MPC6 is set to be released shortly after Fraction’s beta release, Parry said.
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