Cross-chain Protocol Wormhole Raises $225M, Separates From Jump Crypto
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Cross-chain Protocol Wormhole Raises $225M, Separates From Jump Crypto

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4 months ago

Wormhole, a platform facilitating cross-chain bridges, has successfully secured $225 million in funding, valuing the company at $2.5 billion.

Cross-chain Protocol Wormhole Raises $225M, Separates From Jump Crypto
Wormhole, a platform facilitating cross-chain bridges, has successfully secured $225 million in funding, valuing the company at $2.5 billion. The investment comes from prominent supporters, including Coinbase Ventures, Multicoin Capital, and Jump Trading. Jump Trading initially incubated the decentralized finance (DeFi) protocol through its digital asset division, Jump Crypto.

In a departure from traditional equity offerings, Wormhole opted to issue token warrants to its investors. These warrants guarantee that investors will receive a specific amount of a crypto token upon its launch by the protocol.

This fundraising effort represents the final step in Wormhole's separation from Jump Trading's oversight. The decision to part ways was influenced by regulatory scrutiny in the United States and security breaches encountered by the platform's blockchain messaging tool. Wormhole now operates independently under the governance of Wormhole Labs.

The raised capital will be utilized to enhance Wormhole's reputation within the industry and pave the way for a new direction following a significant hack in 2022, which resulted in losses of around $320 million. During that incident, Jump Crypto intervened and provided emergency funds to cover the 120,000 Ethereum (ETH) shortfall. With the assistance of Oasis, a DeFi service provider, Wormhole successfully recovered the stolen assets.

Jump Trading, which has faced its own challenges, is gradually scaling back its involvement in the cryptocurrency sector. The collapse of Terraform Labs in mid-2022 and subsequent legal actions exposed allegations of price manipulation related to Terra's UST token, resulting in the generation of $1.3 billion.

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