New York-based Chaos Labs, founded in 2021, is gaining recognition for its suite of risk management tools designed specifically for the decentralized finance (DeFi) sector.
New York-based startup Chaos Labs, founded in 2021, is gaining recognition for its suite of risk management tools designed specifically for the decentralized finance (DeFi) sector. These tools aim to address the unique risks associated with on-chain financial services, providing enhanced security for DeFi protocols. The company’s recent developments and strategic partnerships are positioning it as a key player in the growing DeFi space.
One of Chaos Labs’ key achievements is the launch of its decentralized oracle protocol, known as Edge. Oracle protocols are used to integrate off-chain data into the blockchain, enabling smart contracts to execute based on real-time information. Edge has seen strong adoption in a short period, with over $30 billion in assets secured and several leading decentralized exchanges integrating the protocol. Among them is Jupiter, the top perpetuals exchange on the Solana blockchain, which has now onboarded Edge.
Chaos Labs’ ability to deliver decentralized oracle services with robust security features has made it an attractive partner for major players in the DeFi ecosystem. The rapid adoption of Edge signals a growing demand for reliable and secure data feeds in decentralized finance.
Another notable development is the increased investment from PayPal Ventures, the venture capital arm of global payments giant PayPal (NASDAQ:PYPL). Having already participated in Chaos Labs’ seed round, PayPal Ventures is now doubling down with participation in the startup’s $55 million Series A funding round.
This move reflects PayPal’s confidence in Chaos Labs’ vision to create a safer and more efficient crypto ecosystem. According to Amman Bhasin, a partner at PayPal Ventures, the decision to continue investing in Chaos Labs stems from their belief that the startup is helping to build a safer on-chain financial infrastructure.
PayPal Ventures sees Chaos Labs as a key player in the effort to transition more financial services onto blockchain technology, a vision that is closely aligned with PayPal’s own long-term goals. Together, the two companies are working towards a future where decentralized financial services are seamlessly integrated into everyday life.
Interestingly, PayPal’s involvement with Chaos Labs goes beyond traditional venture capital investments. The company’s use of its own PYUSD stablecoin to make on-chain investments highlights its dedication to the blockchain ecosystem.
Last year, PayPal introduced PYUSD on the Solana blockchain, marking a significant step in its adoption of blockchain technology for payments and financial services. This investment, along with the PYUSD-backed funding of startups like Chaos Labs, illustrates PayPal’s broader strategy to support the growth of decentralized finance.
PayPal’s stablecoin plays a pivotal role in its blockchain strategy. By leveraging the speed and efficiency of Solana, PYUSD allows PayPal to make secure and low-cost on-chain transactions, further embedding the company in the decentralized finance world. This approach aligns with PayPal’s mission to expand financial services and drive innovation in the crypto space.
notably, the Series A round for Chaos Labs is not PayPal Ventures’ only recent investment in decentralized finance. Previously, PayPal used PYUSD to invest approximately $5 million in Mesh, a startup focused on embedded finance solutions for crypto payments.
This investment indicates PayPal’s broader interest in supporting infrastructure projects that enable the seamless integration of crypto payments into everyday financial services. Mesh’s focus on embedded finance complements Chaos Labs’ efforts to enhance security in the DeFi space. Together, these investments showcase PayPal Ventures’ commitment to fostering the growth of decentralized financial services.
As Chaos Labs continues to expand its product offerings and partnerships, the company is well-positioned to play a central role in the future of decentralized finance. With support from major investors like PayPal Ventures, the company is focused on building tools that address some of the most pressing challenges in the DeFi space, particularly around security and risk management.
The success of the Edge oracle protocol and the substantial backing from PayPal Ventures underscore the growing demand for secure, scalable solutions in decentralized finance. As the DeFi sector continues to evolve, companies like Chaos Labs are at the forefront of efforts to create a safer and more efficient ecosystem for both institutional and retail users.
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