Digital asset management platform Gnosis Safe announced today that it has raised $100 million in a token sale and rebranded as Safe as the community voted to split from its parent company Gnosis Ltd.

The funding was led by 1kx and other investors participating in the round included Tiger Global, A&T Capital, Blockchain Capital, Digital Currency Group, Greenfield One, Rockaway Blockchain Fund, ParaFi, Lightspeed, Polymorphic Capital and Superscrypt.

The community vote to spin-off from Gnosis was approved in April and provided permission for the new company to form as a separate entity. The new company established was dubbed SafeDAO, which would lead the project and branded the new product “Safe” to differentiate itself.

Safe originally began as an Ethereum blockchain wallet that used smart contracts instead of simple private keys or seed phrases to protect assets. The project’s objective was to work with decentralized autonomous organizations, also called DAOs, enterprises and institutional users to provide them with the necessary authentication tools so businesses can manage wallets while avoiding the potential of hacks or looting.

DAOs are a type of organization that is a community-led entity with no centralized authority. They are designed for transparency by making critical votes using blockchain technology for votes and treasury by using governance tokens and cryptocurrencies, which means everything can be publicly audited. Since most of the operations of DAOs are done using cryptocurrencies and other digital assets, they must be managed in digital wallets, which can put them at risk.

This is similar for enterprise and institutional users who wish to hold manage crypto, Safe offers a method to contend with those risks.

“For mainstream adoption of Web3 we need to overcome the risks and limitations of private key accounts,” said Lukas Schor, co-founder of Safe.

Most blockchain wallets use private keys or seed phrases to protect and control the contents stored in the – be it assets, data or identity information. The problem with this sort of authentication device is a private key or seed phrase, which acts as a kind of password, is that it can be stolen and easily hacked.

Crypto industry solutions to this problem have been to use multi-signature private key signing for wallets that require multiple participants to unlock assets before they can be moved. This is how Safe’s smart contracts come into play, it can be configured to require three stakeholders to all sign a transaction on a treasury withdrawal before anything happens.

This greatly reduces the chances of a single person being in control and thus any compromise of their password or keys cannot lead to the plundering of funds.

“The transition toward smart contract accounts will be a joint effort by the entire Web3 community,” Schor said.

The largest share of the funding will go toward the ecosystem investments into wallets and apps for using Safe accounts by using grants and accelerators in order to “foster a vibrant ecosystem of applications and wallets leveraging Safe smart contract accounts.” The company also intends to use the money to help it stay afloat during the extended “crypto winter” while the markets are in a downturn.

Image: geralt/Pixabay

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