Arch Labs Announces $13M Funding Round To Launch A Native Bitcoin Virtual Machine

[PRESS RELEASE – New York City, New York, April 22nd, 2025]

Arch is building the permissionless financial rails for a Bitcoin-denominated world

Arch Labs has closed a $13 million Series A funding round at a $200 million valuation. The round was led by Pantera Capital with participation from other strategic investors. The funds will accelerate the development and launch of the ArchVM, which enables fast, secure, and fully verifiable smart contract-like functionality on Bitcoin.

Bitcoin holds over $2 trillion in asset value, yet the only ways to leverage it for anything other than payments are through centralized applications and exchanges or by bridging assets to Layer-2 networks, which creates additional hurdles and risks. Arch aims to harness and extend Bitcoin’s unmatched security and liquidity by enabling decentralized applications and protocols native to Bitcoin’s ecosystem.

Arch unlocks apps that previously weren’t possible on Bitcoin, with critical improvements over Layer 2s and other bridge-based systems. It brings programmable multisigs that settle natively to Bitcoin, Cross-program invocations, composability across applications, and permissionless deployment of Bitcoin-native financial primitives—lending markets, AMMs, stablecoins, and more. Arch has already settled 50+ million testnet transactions and aims to launch the mainnet this summer.

The Arch architecture has three core components:

• A specialized Arch VM handling state changes and complex off-chain computations that enables Turing-complete smart contracts at the Bitcoin base layer and provides Solana-like TPS.
• A Decentralized Validator Network that facilitates seamless coordination and finality for smart contracts, using Proof-of-Stake consensus to create an economic security model that allows for scalable, permissionless decentralization of the validator set.
• A cryptographic multisig, built on the back of the first-ever implementation of FROST + ROAST signature schemes, allowing for secure, decentralized key aggregation and multi-party computation.

“The potential of Bitcoin has always been immense, but its programmability has remained limited by design,” said Matt Mudano, CEO of Arch Labs. “With Arch, we’re introducing a solution that respects Bitcoin’s foundational principles while significantly expanding its capabilities. Our focus on liquidity, user experience, and security makes Arch uniquely positioned to unlock Bitcoin’s full potential as a programmable financial system.”

This funding round comes as Arch Labs prepares for the upcoming launch of the Arch Network mainnet this summer. The network will enable developers to create smart contracts, deploy DeFi protocols, mint and trade NFTs, and establish DAOs. At launch, it will feature a range of applications, including AMM swaps, lending platforms, Bitcoin-backed stablecoins, and games.

Franklin Bi, General Partner at Pantera Capital, said, “By introducing smart contract functionality directly into Bitcoin’s Layer 1, Arch creates a pivotal execution platform enhancing Bitcoin’s existing framework instead of splitting its liquidity and potential. This strategic addition allows Bitcoin to tap into areas of blockchain utility—such as dApps and programmable contracts—where it had previously ceded ground to Ethereum and Solana.”

Previously, Arch Labs raised $7 million led by Multicoin Capital with participation from Portal Ventures, OKX Ventures, Big Brain Holdings, CMS Holdings, and Tangent.

About Arch Network

Arch Labs is a software development company and the core contributor to Arch Network, a bridgeless execution platform that enables smart contract-like functionality on Bitcoin. With a focus on liquidity, security, and user experience, Arch Labs is transforming Bitcoin into a fully programmable financial ecosystem with $2 trillion in assets. For more information, users can visit https://www.arch.network/

About Pantera Capital:

Pantera Capital is the first institutional investment firm focused exclusively on bitcoin, other digital currencies, and companies in the blockchain tech ecosystem. Pantera launched the first cryptocurrency fund in the United States when bitcoin was at $65/BTC in 2013. The firm subsequently launched the first exclusively-blockchain venture fund. In 2017, Pantera was the first firm to offer an early-stage token fund. Pantera Bitcoin Fund has returned over 94,070% in ten years and has returned billions to its investors. Pantera manages $5.6bn across three strategies – passive, hedge, and venture. For more information, users can visit https://panteracapital.com/.

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