Crypto investment firm Paradigm led an $11.8 million funding round into Blowfish, a firewall provider looking to help Web3 firms fight off the cyberattacks that can often plague their products and services.
Blowfish will allow wallet providers and custodians to offer users real-time warnings and human-readable transaction context, according to an announcement shared with CoinDesk.
Fraud in crypto and the broader Web3 environment not only hurts the confidence of investors but also makes it harder to attain support from the mainstream financial world, such as institutions and regulators. As such, firms offering services that can prevent fraud should be able to attract healthy capital from investors. Earlier this month, fraud-prevention startup Sardine raised $51.5 million in Series B funding led by venture capital giant Andreessen Horowitz (a16z).
Blowfish, which is already available on the Solana, Ethereum and Polygon blockchains, plans to use the funding to expand to new systems and upgrade its fraud-detection engine. Web3 refers to a version of the internet that's based around decentralized platforms, blockchain technology and digital currencies.
One of Blowfish's clients is Solana-based wallet provider Phantom, with whom it has been working since April.
Phantom was one of wallet providers targeted during a hack that drained nearly $6 million from over 9,000 wallets in the Solana ecosystem last month. Following a weeklong investigation, Phantom said that it had found no vulnerabilities in its systems. Solana developers said it was likely that a bug in the code of closed-sourced wallet Slope may have been responsible.
Dragonfly, Uniswap Capital, Hypersphere and Ravikant Capital also contributed to the investment round.