Portal Secures $8.5M From Coinbase for Bitcoin Layer-2 DEX. What is Portal/Fabric?

Portal is self-hosted wallet and DEX (Decentralized Exchange) built on top of Layer-2 platform Fabric. It utilizes Atomic-Swaps to exchange Bitcoin and other cryptocurrencies natively (not wrapped tokens).

Fabric is a “layer-2 and layer-3” smart-contract platform built as an extension of Bitcoin (some of the VCs say “on Bitcoin” but I wouldn’t go as far).

The funding round gathered all the usual suspects: “Coinbase Ventures, ArringtonXRP Capital, OKEx, Republic.co, Shima Ventures, LD Capital, Monday Capital, GenBlock, Taureon, Autonomy Capital, Krypital, B21 Capital as well as the senior executives and founders of Ethereum, DFINITY, MobileCoin, Tether (USDT), Galaxy Digital, Bitcoin.com, Republic, Centre.io, Polymath, Æternity, Hedera Hashgraph, Blockstream, Reef Finance, GlobeDX, FIO, Portion, and 4K.“

The press release had two quotes by Michael Arrington, founder of ArringtonXRP & TechCrunch: “Decentralized cross-chain bridging is one of the hardest problems in crypto right now, especially as multiple blockchains gain real traction. We’re excited to see Portal’s Bitcoin-native approach to multichain transfers go live and provide an alternative bridging mechanism to the growing number of active onchain users.”

He’s probably referring to Atomic-Swaps which are indeed Bitcoin-native and has used by multiple apps since the activation of Segwit in 2017.

Another quote from the press release, from Brain Johnson from Republic Capital only mentions anchoring to Bitcoin’s blockchain“Interoperability is a necessity for blockchain to bridge into the mainstream finance world. Republic Capital invested in Portal with this future in mind. Utilizing Bitcoin’s security as an anchor, we believe the Portal and its team are in a unique position to build one of the leading bridges in DeFi.”

Anchoring on Bitcoin is commonly used by other Bitcoin DeFi projects such as DefiChain or Stacks.

In the same press release Portal CEO Eric Martindale says:

“By bringing a fast, peer-to-peer, Layer 2 exchange — with the speed of centralized exchanges but with privacy — Portal is delivering on the promise of self-sovereignty for everyone. The current centralized exchanges, false “decentralized” DEXs, custodially wrapped tokens, and censorable ecosystems all threaten Bitcoin’s promise of self-sovereignty. Fabric technology enables Layer 3 privacy on cross-chain transactions and eliminates the need for centralized custodians.”

“We believe Bitcoin provides the much needed financial infrastructure that the free, uncensorable internet-of-the-future will be built on, and although we are starting with a P2P exchange, our mission is to be The Platform for decentralized, peer-to-peer human interactions… be it communications, financial transactions, or social media.”

Sounds good so far but then the press release casually mentions: “The funding announcement comes ahead of Portal’s public token sale on Republic.co launchpad in October.”

The press release does not mention what is the utility of the token and how it differs from the equity mentioned in the press release.

To be completed if more info becomes available.