Investors Bet Big on EigenLayer’s Ecosystem with New Funding for Restaking Protocols

.. By Nathan Daniels

May 1, 2024

2 min read

Reading Time: Read Time 2 minutes

The venture capital world is increasingly focusing on the EigenLayer ecosystem, with significant funding rounds announced this week for startups Aligned Layer and Othentic, which are pioneering new technologies in the blockchain space.

Aligned Layer Secures $20 Million Series A
Aligned Layer, a startup leveraging EigenLayer’s restaking technology, has raised $20 million in a Series A funding round led by Hack VC. The funding round also saw participation from several smaller crypto-focused venture firms. The company plans to launch as an actively validated service (AVS) on EigenLayer, utilizing staked ether in novel ways beyond the traditional securing of the Ethereum network.

Functionality and Future of AVS
AVSs represent a range of blockchain protocols or services that benefit from the security provided by EigenLayer’s restaking. To date, the AVSs live on EigenLayer’s mainnet include services like data availability, rollup creation, and oracle data. Despite their innovation, these services have faced profitability challenges, mainly because EigenLayer has not yet enabled in-protocol payments.

Zero-Knowledge Proof Verification by Aligned Layer
Aligned Layer aims to enhance the blockchain ecosystem by making zero-knowledge proof verification more cost-effective. These cryptographic proofs allow for the verification of statements without revealing the data underlying the statements. Hack VC, in a recent blog post, compared Aligned Layer’s potential impact to that of a data availability provider specifically for zero-knowledge proofs.

Othentic’s Seed Funding and Its Role in EigenLayer
Othentic, another emerging player within the EigenLayer ecosystem, has secured $4 million in seed funding led by Finality and Breyer Capital. The startup provides a software stack that facilitates the development of AVSs by offering pre-built components that reduce engineering efforts and accelerate time to market. Nader Dabit, director of developer relations at Eigen Labs, highlighted Othentic’s role in simplifying AVS development on EigenLayer.

Movement Labs’ Impressive Fundraise
In related news, Movement Labs, a company not directly tied to EigenLayer but relevant to the broader blockchain development space, raised $38 million in a Series A funding round led by Polychain. The startup is launching a layer-2 solution named Movement, which utilizes Facebook’s Move programming language. This language is integral to layer-1 blockchains like Aptos and Sui and ensures compatibility with Ethereum Virtual Machine (EVM), facilitating the deployment of Ethereum-based programs.

The Growing Interest in Blockchain Innovations
The recent influx of venture capital into blockchain technologies like those offered by EigenLayer and its associated companies signifies a growing interest in innovative solutions that enhance blockchain functionality and security. As these technologies continue to develop and integrate into the broader crypto market, they represent a new frontier in blockchain’s evolution, promising enhanced security, reduced costs, and faster development cycles for blockchain applications.