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Bitcoin Zero-Knowledge Rollup Citrea Raises $2.7M in Seed Funding
Citrea says it plans to use zero-knowledge cryptography to help grow Bitcoin's budding decentralized finance (DeFi) and NFT ecosystems.
By Sam Kessler
Updated Mar 8, 2024, 9:54 p.m. Published Feb 21, 2024, 5:30 p.m.
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Zero-knowledge rollups – a technology usually associated with scaling the Ethereum blockchain – are now coming to Bitcoin.
Chainway Labs went public earlier this month with the news that it was building what it says will be the first zero-knowledge rollup for Bitcoin: Citrea. On Wednesday, the company disclosed to CoinDesk that it had raised $2.7 million in a seed fundraising round led by Galaxy Ventures.
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The round saw participation from other investors including Delphi Ventures; Eric Wall, co-founder of the Taproot Wizards NFT project; and Anurag Arjun, co-founder of data availability blockchain Avail.
Historically, Bitcoin developers have focused on keeping the network simple, limiting core protocol upgrades to avoid over-complicating the chain and straying from its core use case of peer-to-peer transactions. That's changed over the past year with BitVM and Ordinals inscriptions, which are technologies that help layer 2 platforms use the Bitcoin blockchain to handle a wider array of use-cases, like NFTs and programmable smart contracts.
With Citrea, Chainway is working to help Bitcoin better accommodate decentralized finance (DeFi), NFTs and other use cases that were previously only possible on smart contract-based blockchains like Ethereum, but are now possible for Bitcoin to handle.
Citrea is "the first rollup that enhances the capabilities of Bitcoin blockspace with zero- knowledge technology," Chainway Labs said in a statement shared with CoinDesk. "Every transaction occurring on Citrea is fully secured by zero-knowledge proofs and optimistically verified on Bitcoin."
Zero-knowledge cryptography allows for fast, private and secure data transfer between parties, and it is closely associated with recent efforts to scale the Ethereum blockchain via rollups. Rollups are "layer 2" networks that operate alongside a blockchain, bundle up transactions, and then settle them on the base chain, typically with improved transaction speeds and lower fees for end-users.
Citrea's zero-knowledge rollup will be based on the Ethereum virtual machine (EVM), meaning developers should be able to port over applications that they've built for Ethereum and other compatible networks.
"We're hearing things like Citrea is better than Ethereum," Chainway Labs co-founder Orkun Mahir Kılıç told CoinDesk. "It'll be better with time, because there's like $1 trillion, as of now, sitting in the Bitcoin blockchain. It is the most secure, battle-tested and decentralized blockchain. And we are bringing decentralized finance to it."
Citrea has not launched yet, but Kılıç says his 12-person team plans to release a test network sometime next quarter.
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