Arch Labs, the company behind the Arch Network, a Bitcoin-based application-building platform, has raised USD 7 million in seed funding led by Multicoin Capital, with participation from Portal Ventures, OKX Ventures, Big Brain Holdings, CMS Holdings, Tangent, Cypher and Newman Capital, among others.

The company plans to use the funding to expand its core development team and support the launch of the Arch Network in 2H 2024.

Arch Labs offers a parallelized, proof-of-stake network called the "Arch Network," which enables users to build decentralized applications native to the Bitcoin blockchain. The network features a Rust-based virtual machine that leverages zero-knowledge (zk) proofs and a decentralized verifier network to allow users to interact with applications directly on the Bitcoin blockchain without bridging over from other layer-2 networks.

Analyst QuickTake: The Bitcoin layer-2 space has seen a large influx in investor interest, with companies such as ZKM and Botanix Labs raising USD 5 million and USD 8.5 million , respectively, within the past week. However, Arch Labs has notably differentiated itself from its layer-2 competitors by enabling developers to build applications native to the Bitcoin blockchain without bridging their assets onto a separate layer-2 network. This enables users to access DeFi services such as lending, trading, and staking while benefiting from the added security and decentralization of the Bitcoin blockchain.