PayPal Increases Investment in Blockchain Risk Management Firm Chaos Labs

PayPal Ventures has announced an additional investment in Chaos Labs, a company providing blockchain risk management.

A Friday (Sept. 20) press release announcing the move did not report the amount of the investment.

“Our continued investment in Chaos Labs reflects our belief in their vision to create a safer crypto ecosystem and move more financial services on chain,” Amman Bhasin, partner at PayPal Ventures, said in the release. “Chaos Labs has emerged as a leading risk authority in the sector and we are thrilled to witness their evolution as they launch innovative products like Edge to mitigate oracle vulnerabilities.”

Edge is a new decentralized oracle protocol that combines accurate price data with actionable market intelligence, ensure the security and efficiency of DeFi applications, and provides insights into market dynamics and security risks, according to the release.

The news of PayPal Ventures’ additional investment comes a month after Chaos Labs announced a $55 million Series A funding round that was led by Haun Ventures and included new investors like F-Prime Capital, Slow Ventures and Spartan Capital and existing investors like PayPal Ventures, per the announcement.

Chaos Labs will receive the investment in PayPal’s stablecoin, PYUSD, on-chain, according to the release.

“We’re excited to receive the strong confidence and additional support from the PayPal Ventures team,” Chaos Labs CEO and founder Omer Goldberg said in the release. “Edge by Chaos is the culmination of our entire company’s work and expertise. Edge Price, Risk and Proofs deliver meaningful and unmatched contextualized risk and price data for assets including stablecoins and other real-world assets, in addition to the crypto assets and venues that provide access to them.”

Chaos Labs was founded to secure DeFi protocols against economic vulnerabilities and market manipulation, the company said when announcing seed funding in February 2023.

PayPal introduced PYUSD in August 2023, saying in a press release that the U.S. dollar-pegged stablecoin is “designed to contribute to the opportunity stablecoins offer for payments and is 100% backed by U.S. dollar deposits, short-term U.S. Treasuries and similar cash equivalents.”

In May, the company said PYUSD was available on the Solana blockchain, making the stablecoin faster and cheaper to use.