Opacity Labs, developer of Opacity Network, a data verification platform using zero-knowledge proofs, has raised $12 million in a seed funding round.
Archetype and Breyer Capital co-led the round with participation from a16z Crypto Startup Accelerator (CSX), Finality Capital Partners, Bodhi Ventures, and Escape Velocity (EV3), Opacity Labs said on Tuesday.
Startup Hersh Patel told The Block that the startup began its fundraising efforts last July and closed the round last month. Patel declined to disclose the specific valuation, saying the funding round was structured as a SAFE (simple contract for future assets) that included a valuation cap and token warrants.
This seed round brings Opacity’s total funding to $13.4 million, following a previous $1.4 million pre-seed round.
What is an opaque network?
Opacity is a data verification network that leverages zero-knowledge proofs, allowing users to prove information without revealing underlying details. For example, individuals can verify their income for a mortgage application without disclosing the actual amount.
Technically speaking, Opacity leverages Zero-Knowledge Transport Layer Security (zkTLS), an extension of the standard TLS protocol that incorporates zero-knowledge proofs to enhance privacy and security during data transmission. It also uses a multi-party computation (MPC) architecture with EigenLayer’s Active Validated Services (AVS) acting as a user data validator.
Several crypto projects, particularly in the Decentralized Physical Infrastructure Network (DePIN) sector, such as Nosh and Teleport, use the Opacity Network to verify driver information, Patel said. He added that more partnerships are in the works, including Heale, which is developing an integrated API for logistics, and Earnifi, which is verifying payroll data to improve loan terms for Earned Wage Access customers.
Opacity Network allows developers to “pull verifiable data from any web2 source on-chain, which allows us to bootstrap new platforms and remove barriers to entry for onboarding new users,” said Dmitriy, Partner at Archetype. Berenzon said in a statement.
Although the platform looks promising, Opacity’s other co-founder, Aaron Marz, acknowledged that Opacity faces challenges, including “an adversarial relationship with large platforms that don’t want users to be able to see their data.” However, Marz believes that the benefits of access to verified user data will be attractive to all companies in the future, not just the cryptocurrency industry.
“We expect to see an explosion of new use cases for Cambrian through our partners, as the value of data locked behind walled gardens is so great,” Marz told The Block.
Opacity currently has 15 employees, and the co-founders plan to stay lean in order to scale efficiently in the near future.
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