Scroll, an Ethereum Layer 2 network that uses zk-rollups technology, raised $50 million in a new funding round.
Investors in the round included Polychain Capital, Sequoia China, Bain Capital Crypto, Moore Capital Management, Variant Fund, Newman Capital, IOSG Ventures and Qiming Venture Partners, Scroll said Monday.
Scroll declined to comment on the valuation and the structure of the round, but a source with direct knowledge of the matter told The Block that the round brings Scroll's valuation to $1.8 billion.
Scroll previously raised $33 million in two funding rounds and hadn't disclosed its valuation then. The new round brings Scroll's total funding to date to $83 million.
Scroll was founded in 2021 with the vision of scaling Ethereum to a billion users. As a Layer 2 network, Scroll processes transactions off Ethereum on its own network and then ports the transaction data back to Ethereum — helping increase transaction speed and reduce costs.
Scroll uses zk-rollup technology for its network, helping achieve scalability. Scroll's zkEVM, or zero-knowledge Ethereum virtual machine, batches transactions and then generates proof that these transactions are all legitimate. This proof is then broadcast to Ethereum, and the transactions get approved.
Scroll launched its zkEVM on the Goerli testnet last week as it moved out of its pre-alpha testnet phase. Traction on the pre-alpha testnet was strong, Scroll co-founder Sandy Peng told The Block in an interview. It reached one million unique addresses and 16 million transactions on pre-alpha, she said. The mainnet is expected to launch in the next three to four months, Peng added.
Scroll is one of several Ethereum scaling networks that use zk-rollups. Others include Polygon, StarkWare and Matter Labs. Peng said Scroll's three design principles or core values — community-driven, security first and decentralization at every level — are its competitive edge.
With the fresh capital, Scroll plans to continue building its product, launch its mainnet and expand its ecosystem. To that end, it is also looking to increase its current team size from around 60 to nearly 100 in the near future, Peng said.
© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.