Dfns goes to crypto battle so you don’t have to, raises €12.5 million

Parisian decentralised custody security firm Dfns has raised €12.5 million in a seed funding round. The Techstars-backed startup will use the new capital to roll out their keyless wallets across all DeFi applications, beef up the R&D cryptography programmes, and stock up on staff. Since December 2020 Dfns has raised approximately €13.5 million.

If you hold crypto and know others that do, I’m going to go out on a branch and say that you or someone you know, or someone you know who knows someone else has fallen victim to a loss. And I’m not talking about the dip, I’m talking about a hack.

For me, that cat is Monty Munford, who lost (at the time) £25,000 in crypto. Note that the story dates from 2019. I fear to even calculate the current market value of those assets today.

I saw with horror that all of my Ethereum - about £25,000's worth - had already been taken out; the cupboard was bare." - Monty Munford

As the French might say, le sigh.

Speaking of the French, enter Dfns, a Techstars-backed firm that’s taking on the issue of le hack with some pretty heavy artillery, and yet almost easy enough activate that even my dog could do it. (For the record: my dog is fairly tech-savvy, even figured out how to destroy a smart collar).

Developing a custodial wallet-as-a-service (WaaS) protocol for developers to build on top of “highly secure” cloud environments. And yet, it leaves me to wonder who is working with “lowly unsecure” cloud environments?

“Our goal is to merge the trustless, privacy-preserving ethos of non-custodial setups with the UX, and comfort provided by trusted custody,” explained founder Clarisse Hagège. “By leveraging MPC, ZKP- based cryptography, and modern networking technology, we are today able to decentralise custody like never before and provide the best of two worlds.”

Currently aimed primarily at fintechs, banks, and e-commerce platforms, Dfns provides an API designed to be deployed to custodial wallets in a matter of days, and is already in use by Scrypt, Polymath, and Mt Pelerin, a Swiss crypto bank licensed by FINMA.

“On top of using one of the safest technologies, Dfns is providing one of the easiest custody systems to integrate. The team has been super reactive in integrating our feedback and provided pragmatic solutions to our problems,” commented Mt Pelerin CTO Sébastien Krafft.

Next on the Dfns roadmap is a self-service API targeting developer usage across any number of fields including video games, neobanks, music apps, trading, and lending platforms, and the list goes on.

Dfns’ €12.5 million seed round was provided by White Star Capital, Hashed, Susquehanna, Semantic Ventures, Coinbase, ABN AMRO Ventures, Bpifrance, Ryan Selkis, Xavier Niel, and various unnamed crypto funds.

Munford will be hosting the Web3 portion of our upcoming event in Brussels next month, and I'm fairly certain will have more than a few unique insights to share.