Web3 security service Blowfish raises $11.8M to protect crypto wallets

Web3 wallet security provider Blowfish said today it has raised $11.8 million to launch its service to protect against malicious transactions and fraud.

Crypto-focused venture capital firm Paradigm led the round with participation from Dragonfly, Uniswap Labs Ventures, Hypersphere and 0x Labs.

Blowfish provides firewall technology that identifies dangerous transactions in real time by offering users warnings and human-readable context so they can react before anything happens to their cryptocurrency.

Crypto wallets are fundamental for accessing crypto ecosystems because they allow users to store and manage digital assets, such as cryptocurrency tokens, using private keys, keeping them safe and accessible. They also permit users to send, receive and spend cryptocurrency. Wallets are a major target for hackers and fraud because they store the keys that access the token balances and permit trading and spending, so mitigating this danger can be very important for users and custodians.

Blowfish brings together a large number of developers and engineers from across the industry with blockchain, cybersecurity and machine learning experience from Meta Platforms Inc., Trail of Bits, 0x Labs and MakerDAO. Many have already worked on similar projects in monitoring Web3 and crypto transactions and developing trusted and secure infrastructure.

Using its service, wallet providers can hook into an application programming interface designed to detect and warn against a number of different attacks that precede scams, hacks and a potential loss of funds. Examples include phishing attacks, domain name service hijacking, software supply chain attacks and more.

The company has already teamed up with Phantom, the Solana-based crypto wallet to help protect its users against potential scams. According to Blowfish, since integrating its API, it has already scanned more than 125 million transactions and stopped 11,000 attacks that could have caused losses for users.

“Blowfish has helped us protect thousands of our users from malicious scams and fraud,” said Francesco Agosti, co-founder and chief technology officer of Phantom. “Their API is easy to use and reliable. We’ve partnered with them because we trust their ability to continue building a great product that stays one step ahead of scammers.”

Phantom was a target in an attack that drained more than $6 million worth of cryptocurrency from Solana-based wallets in August. After an internal investigation, Phantom said it discovered no vulnerabilities in its wallet. Further investigation of the incident showed that it appeared that the Solana-based Slope wallet was the primary source of the exploit.

With the new funding, Blowfish said, it will upgrade its fraud detection engine for Solana, Ethereum and Polygon to make it better at detecting scams, and also will expand its service to even more blockchains. In addition, the company will hire more people to continue expanding its product.

Image: Pixabay