EthStorage, a crypto startup that aims to scale Ethereum storage via a Layer 2 network, reached a $100 million valuation in its seed funding round.
The fundraise of $7 million was led by crypto investment fund dao5, EthStorage said in a tweet Thursday. Other investors in the round included SevenX Ventures, Foresight Ventures, Sky9 Capital, Gate Ventures and Galxe.
The funding round was structured as a simple agreement for future tokens (SAFT), Kevin Yang, managing partner at Gate Ventures, told The Block. EthStorage did not immediately respond to a request for comment.
EthStorage was founded last year by Qi Zhou, who is also the founder of blockchain infrastructure startup QuarkChain, which he founded in 2018 after working for companies like Google and Meta. QuarkChain has its own token, QKC, which currently has a market capitalization of over $66 million, according to CoinGecko data.
What is EthStorage?
Currently under development, EthStorage is a Layer 2 storage rollup built on top of Ethereum. "Through the periodic submission of storage proofs from the EthStorage Layer 2 network to Ethereum L1, the platform aims to capitalize on Ethereum mainnet security features while significantly increasing Ethereum's storage capacity at a considerably reduced cost," Gate Ventures said in a blog post today. "Its goal is to achieve Petabytes of storage capacity with storage costs reduced by a factor of 1/1000."
Gate Ventures compared EthStorage to other blockchain storage projects, including Arweave and Filecoin, and said that EthStorage provides features currently unavailable by those projects. "Ethstorage is paving the way for an innovative, cost-effective, and dynamic storage solution that has the potential to address the limitations faced by existing storage options," Gate Ventures said.
EthStorage's seed round comes during a period of reduced venture capital investment in the crypto sector. Global venture capital investment in crypto startups has declined for five consecutive quarters, according to data compiled by The Block Pro Research.
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