NextBlock invests $3M in Soda Labs to expand blockchain privacy

• NextBlock has backed Soda Labs with a $3 million seed investment.
• Soda Labs is scaling its privacy-focused infrastructure to run across multiple prominent blockchains.
• The funding will drive commercial adoption, validator network expansion, and integration with financial systems.

NextBlock has fully funded a $3 million closed seed round for Soda Labs. The capital will support the blockchain infrastructure firm as it scales its programmable privacy technology, which is designed to secure financial activities on public networks.

This backing arrives as Soda Labs transitions from its current gcEVM privacy layer to Soda Bubble. Designed as a chain-agnostic coprocessor, Soda Bubble facilitates private computations across diverse blockchain networks.

For the past two and a half years, Soda Labs has focused on building a cryptographic privacy system utilizing garbled circuits and multiparty computation (GC-MPC). Built on recognized cryptographic standards like AES and SHA256, the technology operates on standard cloud CPUs, eliminating the need for specialized hardware.

“What attracted us to Soda was not only the underlying cryptography, but the practicality of the technology for the financial workloads we believe will matter most onchain,” said Pieter van Poecke, Founder and General Partner of NextBlock.

Van Poecke noted that Soda Labs already possesses a live product and a paying client base. He highlighted that their technical intellectual property, technical founding team, and commercial execution provide a strong foundation for future growth.

Expanding Privacy Infrastructure

Soda Labs’ technology has already handled over 100 million transactions on the COTI network. Among its live integrations are the perpetuals exchange PriveX and the tokenization platform Zoniqx. PriveX has registered more than $20 billion in trading volume, while Zoniqx continues to onboard asset issuers across various jurisdictions and asset classes.

While the firm’s gcEVM privacy layer continues to run on COTI, Soda Labs is broadening its architectural reach via Soda Bubble. This coprocessor allows developers to execute custom workloads across different chains without revealing sensitive data to the public or to Soda Labs itself.

Additionally, the Bubble Validator Network enables participants to mathematically verify the accuracy of computations involving private data. Soda Labs is currently deploying Bubble across major EVM networks, including Ethereum, Polygon, Arbitrum, and Base, with plans to expand to non-EVM chains like Solana.

Driving Commercial Adoption

The $3 million seed funding provides Soda Labs with a 12-to-18-month runway to prioritize commercial execution and scale adoption. The company plans to allocate the capital toward its go-to-market initiatives, expanding its validator network, broadening blockchain compatibility, hiring talent, and integrating with banks, payment processors, tokenization platforms, and financial infrastructure providers.

The firm is currently conducting several confidential pilot programs with financial and infrastructure players, aiming to transition these projects into live production environments.

Soda Labs plans to release updated performance benchmarks in the near future. Recent testing on the Arbitrum live network tracked the entire transaction lifecycle, encompassing encryption, MPC computation, consensus, and settlement. The tests indicated a five- to tenfold performance boost over previous benchmarks, though the precise data remains unreleased. According to the company, its GC-MPC architecture can deliver roughly 10 to 100 times higher throughput and 100 to 1,000 times lower transaction fees compared to existing alternatives.

“Public blockchains already have the liquidity, users and financial applications. What they lack is a way for regulated money to move without showing everyone everything,” said Avishay Yanai, Co-Founder and CEO of Soda Labs.

Yanai explained that Bubble is built to offer financial institutions, payment firms, and tokenization platforms robust privacy and selective disclosure capabilities, all while leveraging the blockchain networks they already use.