2023 was not the best year for crypto companies. According PitchBook data, VC investment in crypto companies fell by 68% in 2023 compared to 2022. To be fair, crypto companies still raised $9.5 billion. But that’s a small number compared to 2022, the year crypto companies raised $30 billion.
And yet, some startups do better than others. French crypto startup Furnace just closed a $17 million funding round in December 2023. 1x is leading the round with Crypto.com, IOSG, Wintermute Ventures, KXVC and LBank also participating. Some existing investors are also putting more money into the company.
Even if you’re familiar with the big names in the cryptocurrency space, you might not be aware of Kiln, as the company has focused on white-label infrastructure-focused products. Companies like Ledger, Crypto.com, and Coinbase rely on Kiln’s technology for their pooled staking services in their non-custodial wallets (Coinbase Wallet, Ledger Live, etc.).
We remind you that staking consists of locking crypto assets in a blockchain for the security of a blockchain and its transactions. There are financial incentives when you stake assets as you earn rewards over time.
Several proof-of-stake blockchains allow their users to stake crypto assets, such as Polygon, Solana, and Avalanche. But the largest proof-of-stake blockchain is Ethereum, which switched to this mechanism in September 2022.
In this ecosystem, Kiln provides a series of smart contracts that facilitate staking. Essentially, Kiln programmatically manages staking through these on-chain contracts. With a simple transaction, users join Kiln’s staking pools and start earning rewards. Kiln and its partners also receive commission, which also automatically manages the smart contract.
And it works extremely well and so does the company currently managed 1.168.288 bet ETH. At today’s exchange rate, that represents nearly $3 billion in ETH assets under management. Over the past year, Kiln has increased its “share under management” by 5 times.
The largest Ethereum validation node operator
In addition to these on-chain products, Kiln has an SDK and API to facilitate integration with its staking pools. It also operates a large network of validators. On the Ethereum blockchain, Kiln is currently the largest validation node operator with just over 4% market share according to Graded data.
“Operating our own validation nodes is a way to guarantee the highest level of security while optimizing the highest financial performance. It also helps when it comes to improving tracking. Finally, this hands-on approach helps us appear as a legitimate company with strategic partners like the Ethereum Foundation, which shares our best practices and anti-slashing strategy,” Kiln Chief Marketing Officer Marie Siegrist told me.
There are various ways to offer a bet or “fake bet”. For example, many centralized exchanges such as Coinbase and Binance offer staking rewards. Behind the scenes, these centralized exchanges manage crypto assets for you. There are also liquid staking protocols like Lido, which provides a different token to represent a staked ETH.
But if you want to integrate one-click staking into a non-custodial wallet, Kiln seems to be a good white label technology provider. It’s a low-level approach to staking, and some companies even ask Kiln to run special validation systems for them.
“Today’s news demonstrates our commitment to developing our betting platform at enterprise level, and we are delighted to be joined by leading digital asset investors who are ready to help us achieve our goals. . . We have an exciting product line and upcoming expansion plans, including the establishment of an office in Singapore,” said Kiln co-founder and CEO Laszlo Szabo.
Kiln has raised a total of $35 million since its inception. The company receives a commission for staking rewards, which means that the company’s revenue will grow along with its total assets under management.
