Portal Raises $34M in Seed Funding for Bitcoin-Based DEX

Bitcoin-based cross-chain decentralized exchange and wallet Portal raised $34 million in a seed funding round. Investors in the round included OKX Ventures, Arrington Capital, Coinbase Ventures, and Gate.io, the company announced on Jan. 30. 

Portal co-founder and CEO Chandra Duggirala said the funding round comprised a combination of a simple agreement for future equity (SAFE) and convertible notes. SAFE offers investors future equity rights without an immediate ownership stake, providing flexibility for both parties. Duggirala said the round has no debt and didn’t comment on the company’s valuation.

Portal’s seed funding round, totaling $34 million, exceeds the typical size for such rounds and reflects the heightened interest in the expanding Bitcoin (BTC) ecosystem. This latest funding round and $8.5 million from 2021 pre-seed funding bring the portal’s total funding to $42.5 million. 

The new capital will be used to develop the company’s two flagship products: a noncustodial crypto wallet and a decentralized exchange. Portal DEX facilitates Layer 2 atomic swaps of cryptocurrencies across different blockchain networks.

Atomic swaps allow these exchanges without needing a third party, such as a centralized crypto exchange. Moreover, Portal Wallet, a “fully non-custodial” tool, integrates the DEX and allows individuals to store, send, and receive cryptocurrencies across blockchains.

Duggirala emphasized the inherent risks in existing cross-chain swap tools such as wrapped tokens and bridges. He said these tools have lost billions of dollars in the hacks and involve some custody-related concerns.

In contrast, Portal distinguishes itself by not holding customer funds at all, whether through single or multiple signatures. Meanwhile, Portal’s products are in the testnet phase. Duggirala expressed confidence in achieving mainnet readiness by March.

Duggirala stated:

“We want to support and integrate with as many wallets and single-chain decentralized exchanges that use bridges. Our goal is to replace completely the custodial risk in this space.”

Portal’s Token and AI Plans

Regarding the prospect of introducing its native token, Duggirala said the decision would depend on the validators of the Portal network. The network operates on the xport (proposed ticker) token, an ERC-20 token used to secure the network and reward validators for facilitating the swaps.

Established in 2019, Portal is based in the San Francisco Bay Area. Duggirala didn’t reveal the current staff count but noted that the team has doubled in the past year. Moreover, the firm also plans to introduce an AI-powered investment application in the coming months. It will assist users in making informed and “intelligent” investment decisions.