Israeli startup to create blockchain chips with $70M of fresh funds

The adoption of blockchain technology is on the rise, with most enterprises looking into the technology in some capacity. As blockchain becomes more pervasive, all types of users will need the most efficient access to the capabilities of this technology.

One of the responses to this has been the development of blockchain chips as energy-efficient accelerators. On Feb. 23, the Tel Aviv-based blockchain chip startup Chain Reaction announced it raised $70 million to expand its engineering team for developing its next chip.

Alon Webman, the co-founder and CEO of Chain Reaction, said the new chip would be a “fully homomorphic encryption” chip that lets the user work on data while the chip is encrypted.

“Today, if you have data (which) is encrypted into the cloud and in order to do any data operation or data analytics, do A.I., you have to decrypt the data.”

He continued to say that governments and major industries, like the defense sector, that could utilize cloud services are currently restricted due to security concerns.

“The moment the data is decrypted, it can be attacked by a malicious user to read it, to steal it, or even to change it.“

An encrypted chip, which allows access to data under encryption, could help with this. Webman says Chain Reaction aims to launch that chip as early as the end of 2024.

Related: Modular blockchains could be the next hot crypto market trend in 2023

According to Webman, Chain Reaction intends to start mass production of its current blockchain chip, Electrum, in the first quarter of 2023. The chip is designed to support quick and efficient hashing. It can also be used in mining cryptocurrencies. 

In February 2022, the software developer Intel also launched a blockchain chip designed by Nvidia to speed up energy-consuming blockchain tasks that require large amounts of computing power.

Nvidia also has a separate chip with a specific purpose for Ethereum mining.