New Jersey-based blockchain company Offchain Labs announced that it has secured $3.7 million in a recently closed seed funding round.

The announcement detailed that the funding round was led by Pantera Capital. In addition, Offchain Labs also received funds from other investors including Compound VC, Raphael Ouzan of Blocknation, and Jake Seid, managing director of StoneBridge Ventures.

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Commenting on the successful fundraising round, Steven Goldfeder, co-founder of the company, told Finance Magnates: “We’re thrilled to have raised this funding with lead investment by Pantera Capital, which has backed many of the top blockchain projects. The funding will be used to help build Arbitrum, as well as hire and onboard talented developers in the space. In the next phase of our development, we will look to onboard partners and continue to grow the platform.”

Filling the Gap Between Blockchain and Enterprise Solutions

Offchain Labs is developing a solution to introduce blockchain into an enterprise ecosystem. Dubbed as Arbitrum, it will enable both side chains and state channels for sophisticated off-chain execution, with support for optional smart contract privacy.

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The company is leveraging ‘AnyTrust’ consensus mechanism to guarantee correct behavior for each transaction, even if only one of a contract’s validators is acting honestly.

“Through Arbitrum, we’ve built a Layer 2 solution that has the capability to make smart contracts more scalable, private, and compatible with existing programs on Ethereum,” Ed Felten, co-founder of Offchain Labs, explained.

“The platform is also able to support more sophisticated dApps, as well as faster computation rates and higher levels of privacy by taking transactions off-chain, which will be an advantage for enterprises looking to integrate blockchain technology into their businesses.”

Venture Capitals Betting on Blockchain

Last week, Finance Magnates reported that Pantera had raised $160 million for its third blockchain-focused venture fund. At the time, the fund managers had also revealed that, with the new fund, the company aims to invest in a total of 35 blockchain businesses.

“At Pantera, one of the biggest problems we see in the blockchain industry is that dApps face scalability challenges. The team behind Offchain Labs has developed a novel solution to this issue with Arbitrum, and we’re enthusiastic about this platform’s potential to help dApps really take off. The unique properties of Arbitrum allow it to serve as a great Layer 2 scalability solution,” Joey Krug, co-chief investment officer at Pantera Capital, added.