Cryptography startup Fabric raises $33M for new data privacy chip

Fabric Cryptography, a Silicon Valley hardware startup, has closed a $33 million Series A funding round co-led by Blockchain Capital and 1kx to build new computing chips focusing on data privacy. 

The round also saw the participation of Offchain Labs, Polygon, and Matter Labs. The investment follows a $6 million seed round led by Metaplanet with participation from Inflection and Liquid2 Ventures, among other investors. 

According to an Aug. 19 announcement, the startup is developing a new cryptography processing unit called the Verifiable Processing Unit (VPU), a silicon chip that uses a cryptography-specific instruction set architecture. “This means that any cryptographic algorithm can be broken down into its mathematical building blocks that are natively accelerated and supported by the chip,” said the company. 

The new chip is expected to go into production later this year and is planned to improve speed and cost running for cryptographic workloads when compared to central processing units (CPUs) and graphical processing units (GPUs). 

The startup is founded by former MIT and Stanford students Michael Gao, Tina Ju, and Sagar Reddy. 

“There exists a whole world of advanced cryptographic algorithms that go beyond protecting our data, and can actually begin to guarantee trust, if we can run them efficiently,” said Gao in a statement. He continued: 

“Billions of dollars have been poured into better AI chips of all kinds, but researchers and industry projects in cryptography have had to settle with CPUs or GPUs, which were never made for the kind of intensive math that advanced cryptography uses.”

Fabric has found a market fit for its hardware in the blockchain space amid the growing use of zero-knowledge proofs to improve privacy and security in onchain transactions. According to the startup, it has received “tens of millions of dollars in pre-orders for their VPUs” coming from the Web3 industry. 

The startup is also working on a software stack to make the technology accessible to software developers. 

“The VPU can be programmed to run virtually any cryptographic workload efficiently […]. Unlike other fixed-function chips, which are common in cryptography, the VPU is future-proof — it can adapt to new cryptography algorithms as they are developed and productionized,” said Dr. Wei Dai, cryptographer and research partner at 1kx.

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