Tether backs Ark Labs $5.2 million seed raise to expand stablecoin and programmable finance infrastructure on Bitcoin

Ark Labs has raised $5.2 million in a seed funding round to expand infrastructure for programmable financial applications on Bitcoin (BTC).

The round included backing from Tether (USDT), Ego Death Capital, Epoch VC, Lion26, Sats Ventures, and Contribution Capital, with participation from Anchorage Digital, former PayPal VP of Finance Ralph Ho, and other digital asset and fintech investors, according to a statement shared with The Block. Ark Labs declined to disclose the structure of the round, when it opened and closed, and a post-money valuation.

Established in 2024, the raise brings Ark Labs' total institutional backing to more than $7.7 million, following an earlier pre-seed round supported by Draper Associates, Fulgur Ventures, and Axiom Capital.

The funding announcement also coincides with the launch of stablecoin and other digital asset support on Arkade, the company's flagship infrastructure platform designed to enable programmable transactions settled on Bitcoin.

The fresh capital will help grow Ark Labs' team from 10 to around 25 employees while expanding developer relations, product development, and partner onboarding, CEO Marco Argentieri told The Block. The company also plans to build the tooling required to "bring stablecoin and bitcoin liquidity together at production scale."

What is Arkade?

Arkade launched in public beta in October 2025 as a Bitcoin-native Layer 2 designed to support instant offchain transactions and more complex financial applications without altering Bitcoin's consensus rules.

Built using the Ark protocol specification, the platform virtualizes Bitcoin's transaction layer through presigned Virtual Transaction Outputs, or VTXOs — offchain representations of native Bitcoin UTXOs — allowing users to move assets while retaining the ability to reclaim funds onchain.

Arkade Assets extend the same architecture to stablecoins and other tokens. The assets are embedded within VTXOs — the same transaction structure Arkade uses for bitcoin — allowing them to be issued, transferred, and burned offchain while an operator enforces transaction validity, Argentieri told The Block.

A single Bitcoin output can carry multiple assets within Arkade's offchain environment, allowing most activity to occur without leaving a footprint on the blockchain. Supply changes, such as stablecoin issuance or redemption, are managed through a "control asset" mechanism designed to automate supply adjustments, he said.

If an Arkade operator goes offline, users can enforce their assets onchain using OP_RETURN metadata — a fallback mechanism Argentieri said works similarly to how the Omni protocol historically handled token issuance on Bitcoin.

The architecture aims to extend Bitcoin's functionality beyond simple payments by enabling applications such as lending, trading, and asset issuance while remaining within Bitcoin's security framework. Ark Labs has argued that while Bitcoin holds a dominant position as a store of value, limitations in programmability have historically pushed financial applications to other blockchains.

"Bitcoin is the most liquid digital asset in the world, but it has lacked the programmable infrastructure that financial applications require," Argentieri said in the statement. "Arkade changes that ... and Tether's involvement will be key to accelerate these efforts."

Arkade already supports partners developing services across payments, lending, and cross-network settlement, with the infrastructure designed as a scalable execution layer for wallets, fintech firms, and financial institutions, the firm said.

"Every fintech building digital products faces the same question: whose infrastructure do you depend on?" Ark Labs Head of Ecosystem Alex Bergeron said. "On other networks, that infrastructure is increasingly permissioned, driven by a single company's interests. Arkade is the open, neutral alternative."

Expanding stablecoin infrastructure on Bitcoin

For Tether CEO Paolo Ardoino, expanding stablecoin infrastructure on Bitcoin remains a priority.

"Stablecoins were born on Bitcoin, and expanding access on the Bitcoin network remains a priority for us," Ardoino said. "Ark Labs is building infrastructure that makes it easier to issue, move, and settle stablecoins directly on Bitcoin."

Ardoino added that improving access to USDT on Bitcoin could support "greater financial inclusion, more efficient cross-border payments, and stronger global liquidity."