Chaos Labs, a startup providing an automated economic security system for decentralized finance (DeFi) protocols, has raised $20 million in seed funding. The round was co-led by Galaxy Digital and PayPal Ventures, with participation from Coinbase, Uniswap, and other notable investors.
The funding will be used to expand Chaos Labs’ suite of risk and security products for DeFi protocols. The startup aims to help DeFi protocols protect user funds from attacks while optimizing capital efficiency.
The need for such solutions is clear: last year, hackers stole a record-setting $3.8 billion in crypto assets, with the vast majority coming from DeFi protocols, according to a recent Chainalysis report.
Chaos Labs, founded in October 2021, offers an automated, on-chain risk management platform that provides DeFi protocols with customized security monitoring and a simulation engine to verify the protocol’s health and stability in any market conditions. The startup has partnered with liquidity protocol Aave, blockchain data provider Chainlink, and decentralized exchange Uniswap.
“At Chaos Labs, we believe that every DeFi protocol must regularly conduct robust risk testing to verify and validate that their economic system is secure against hackers and unanticipated volatility,” said Chaos Labs founder and CEO Omer Goldberg.
