Hinkal, a zero-knowledge (ZK) protocol that enables institutional investors to trade privately on-chain, has raised $1.4 million in a strategic funding round.
SALT Fund, an investment fund led by Anthony Scaramucci’s son AJ, led the financing round, Hinkal said on Friday. Other investors include Draper Associates, SNZ Capital and Peer VC.
Nika Koreli, Hinkal’s co-founder and CTO, told The Block that the company expanded its strategic round due to increased investor interest. “We received interest in March and closed the round within two weeks,” Koreli said.
He added that the round consisted of simple contracts for future assets (SAFE) and token warrants, bringing Hinkal’s valuation to $70 million.
Tal Cohen, CEO of Kraken US, also joined Hinkal’s advisory board.
What is Hinkal?
Hinkal facilitates confidential on-chain transactions for institutional investors including venture capital funds, liquid funds, and family offices. This is made possible through the ZK Protocol, which allows users to participate in decentralized applications using self-managed private wallet addresses.
“In traditional finance, you can send/sell/swap without people watching,” Koreli said. “Hinkal makes this possible for cryptocurrencies, bringing a new wave of institutional users who value this discretion on-chain.” “He said.
Hinkal requires users to verify Know Your Business (KYB) to prevent illegal use of the protocol. Koreli explained that Hinkal has developed a proof layer, giving users a choice of verification method. Users can verify ownership with a centralized exchange account (such as Coinbase or Binance) or use decentralized identity (DID) providers such as Authento, ZkMe and Galxe Passport, he said.
Koreli acknowledged that Hinkal’s KYB verification process is similar to traditional finance, but differs in that users can enable reusable proofs. In contrast, traditional finance requires users to undergo KYB verification every time they open an account, he said.
Koreli said “top VCs,” including some of Hinkal’s investors, are currently using the protocol, but did not name them.
‘Vested Token’ sale
Hinkal said it ensures that users, including VCs, only liquidate tokens that are vested through the protocol. “Traditional vesting models typically restrict the transfer of unvested tokens, preventing them from being deposited into Hinkal,” Koreli said. “There are some exceptions to ‘floating vesting’ that users can trade. Allows deposits and liquidations.”
AJ Scaramucci, founder and managing partner of SALT Fund, called Hinkal a “groundbreaking protocol” in a statement and said it “solves a critical pain point for institutional funds, founders and VCs by enabling private DeFi trading strategies and token liquidation without disrupting them.” said. A wider market.”
Hinkal operates on seven blockchain networks, including Ethereum, Base, Arbitrum, Optimism, Avalanche, Polygon and BNB Chain, and supports all major dapps, Koreli said.
Hinkal currently employs about 10 people, and Koreli plans to maintain a lean team structure.
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