Smart contract startup Kadena has raised $2.25 million in a pre-A financing private-placement SAFT round for its new blockchain project.
According to the startup, Metastable, Kilowatt Capital, Coinfund and Multicoin Capital all invested in Kadena through a private-placement SAFT round.
The funding goes to support Chainweb, a project focused on scaling and security issues and realized through the combination of multiple peer blockchains to process transactions, rather than the use of one single decentralized blockchain like the one that underlies bitcoin, said Kadena co-founder Stuart Popejoy.
By using multiple chains, users can avoid the network issues which plague other public blockchains like bitcoin and ethereum, the former JP Morgan Chase blockchain developer told CoinDesk.
“A Cryptokitties-like application can run on five or six chains of its own, while a massive [initial coin offering] can happen on another chain in the network and they won’t slow each other down. And even if you run into an issue where you have congestion, you can provision chains to make up for the load.”
The different chains integrate their Merkle roots with each other, ensuring that while they each act as a unique blockchain, they can still share information and create a consensus among the ledgers.
Unlike other scaling proposals, Chainweb’s parallel network model maintains security without using side channels or only using part of a blockchain to process a large number of transactions. Popejoy said Kadena’s tests found an extremely high level of security with their proposal, which intends to produce roughly 1,000 different chains eventually.
In addition, each chain will produce Kadena’s token, though the exact function that determines how many tokens are released and what timeline they will be released over has not yet been determined, Popejoy said.
That being said, the Chainweb protocol will ensure that the same coin cannot exist on two chains at once.
“It is a single currency, when you want to move coins from one chain to the next it’s a [Simple Payment Verification] so coins are deleted on one chain before being created on the other,” he continued.
The project began as a way to develop better smart contract language for users, Popejoy said. It integrates with Pact, the smart contracts service already offered by Kadena to enterprise customers.
However, Chainweb will go beyond businesses and become a public network, he said.
Using Chainweb’s parallel network model, Kadena hopes to increase volume for a single token up to 10,000 transactions per second while maintaining low transaction fees, according to the press release.
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