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Portal, a decentralized finance (DeFi) project that’s looking to build out a DeFi ecosystem on the Bitcoin blockchain, today announced that it has raised $8.5 million. Coinbase Ventures participated in the round.
DeFi, or decentralized finance, is the collective name of a system of interconnected smart contracts that allows users to act as financial institutions, rather than relying on banks or brokers. DeFi comprises a wide array of financial platforms focused on lending, yield farming, crypto derivatives, liquidity pools, and more.
Based on a technology called Fabric, Portal aims to “deploy censorship-resistant layers on top of the Bitcoin base layer.”
“By bringing a fast, peer-to-peer, Layer 2 exchange—with the speed of centralized exchanges but with privacy—Portal is delivering on the promise of self-sovereignty for everyone,” noted Portal CEO Eric Martindale. “Fabric technology enables Layer 3 privacy on cross-chain transactions and eliminates the need for centralized custodians.”
As their name suggests, second (or third) layer solutions allow developers to deploy various protocols on top of blockchains to take some of the computations off the main network. This could be beneficial in several ways, including lesser load and higher customizability of a network.
In other words, Portal’s developers are working to create a full-fledged DeFi ecosystem based on the Bitcoin blockchain—as opposed to Ethereum, where most DeFi protocols currently reside.
Coinbase joins round
Apart from Coinbase Ventures, the list of Portal’s funding participants also included ArringtonXRP Capital, OKEx, Republic.co, Shima Ventures, LD Capital, Monday Capital, GenBlock, Taureon, Autonomy Capital, Krypital, and B21 Capital.
“Decentralized cross-chain bridging is one of the hardest problems in crypto right now, especially as multiple blockchains gain real traction,” said Michael Arrington, founder of ArringtonXRP and TechCrunch. “We're excited to see Portal's Bitcoin-native approach to multichain transfers go live and provide an alternative bridging mechanism to the growing number of active on-chain users.”
Republic Capital’s Brain Johnson also argued that “interoperability is a necessity for blockchain to bridge into the mainstream finance world.” As such, his company’s investment in Portal was “with this future in mind.”
Members of various well-known crypto projects have also invested in Portal, including Hedera cofounder Kyle Armour, Tether co-founder, Craic Sellars, CEO of Bitcoin.com Danish Chaudhry, and others.
Editor's note: This story and its headline were updated after publication to clarify that Coinbase did not lead Portal's $8.5 million funding round.