Author: Bryan, AI New Intelligence

Israel is slowly becoming a Web3 startup nation, creating hundreds of new jobs within the country's rapidly evolving blockchain ecosystem.

Israel's vibrant entrepreneurial environment has made it the startup capital of the world, having developed 97 unicorns (private companies valued at over $1 billion) and boasting the highest per capita startup density. In 2021, over $2.5 billion was invested in Israeli startups, setting a record for the country.

With the deepest pool of tech talent, a dynamic startup culture, and top-tier venture capital firms, Israel is an ideal destination for blockchain innovation, and the future development potential of its Web3 sector is immense.

Additionally, the Israeli government is actively promoting digital transformation and supporting the development of blockchain and cryptocurrencies. As global demand for decentralization continues to grow, Israel's Web3 sector will continue to attract more investment and entrepreneurs, becoming one of the world's leading Web3 innovation hubs.

What surprised me the most is that Israel is home to renowned cryptographers such as Eli Ben Sasson, Shaffi Goldwasser, Yehuda Lindell, Aviv Zohar, and Eran Tromer, who are key proponents of revolutionary technologies like MPC and ZKP.

The following image illustrates Israel's landscape in the Web3 project ecosystem. Next, I will select three of the most representative Web3 companies to familiarize readers with this formidable Web3 tech powerhouse.

Fireblocks: One of Israel's Highest Valued Blockchain Security Companies

Founded in 2018, Fireblocks' core technology products primarily consist of Fireblocks Networks and MPC-based wallet infrastructure.

Fireblocks is a platform that protects digital assets in transit, focusing on securing customers' digital assets during transactions, with brokers, and during transfer transfers.

Fireblocks enables banks, fintech companies, exchanges, liquidity providers, OTCs, and hedge funds to securely manage digital assets across a wide range of products and services.

Between 2018 and 2019, Israeli security engineer Michael Shauolov co-founded Fireblocks with Idan Ofrat and Pavel Berengoltz, with Shauolov serving as CEO. For the past 20 years, all three founders have been active in the cybersecurity field.

Before joining Fireblocks, Michael Shauolov was involved in founding Lacoon Mobile Security, which was later acquired by Check Point.

Why start a business? This brings us to the 2017 incident when the Lazarus Group hacked four South Korean exchanges and stole $200 million worth of Bitcoin.

At that time, Fireblocks' founder Michael Shauolov was working at Check Point as a member of the task force investigating large-scale cyber breaches.

During the investigation, two things became evident: the shift of cybercriminals from traditional finance to digital assets, and the complexity and lack of solutions for securing digital assets in enterprise environments.

Thus, the obvious next challenge was to ensure the security of blockchain. Consequently, Michael Shauolov co-founded Fireblocks with Idan Ofrat and Pavel Berengoltz.

Currently, Fireblocks has raised five rounds of funding:

June 2019: Series A funding of $16 million;

November 2020: Series B funding of $30 million, with participation from Paradigm;

March 2021: Series C funding of $133 million, with investors including Ribbit Capital, Coatue, and Stripes;

July 2021: Series D funding of $310 million, with investors including Sequoia Capital, valuing the company at $2.5 billion;

December 2021: Series E funding of $550 million, with investors including D1 Capital Partners, valuing the company at $8 billion;

Fireblocks' valuation skyrocketed threefold in just six months, making it one of the three highest-valued private companies in Israel.

Secret Network: The First Privacy-Preserving Smart Contract Public Chain Based on Cosmos

Secret Network is the first privacy-preserving smart contract public chain built on the Cosmos technology architecture (supporting smart contract deployment + privacy attributes + Cosmos scalability and interoperability).

Secret Network is a Layer 1 privacy public chain built on the Cosmos SDK and Tendermint core consensus mechanism, enabling interoperability with other Cosmos SDK application chains that have opened IBC interfaces through the IBC protocol.

Secret Network primarily achieves data privacy through several key components: encrypted smart contracts (Secret Contracts) and Trusted Execution Environments (TEE).

The founding team of the project is SCRT Labs, which includes members such as Guy Zyskind (Founder and CEO), Itzik Grossman (Vice President of Engineering), Nir Zyskind (Director of Operations and Business Development), Assaf Morami (Lead Software Engineer), and Tom Langer (Senior Software Engineer).

Founder Guy graduated with a bachelor's degree in Electrical Engineering and Computer Science from Tel Aviv University in Israel and obtained a master's degree from the Media Lab at MIT in the United States. He co-founded SCRT Labs in June 2016 as a co-founder and CEO.

Privacy issues will become increasingly important in the future, presenting a significant demand, thus there is a high chance of emerging Alpha opportunities in the privacy sector.

Currently, the biggest problem in the privacy sector is not privacy itself, but the high costs, low efficiency, and poor user experience associated with protecting privacy, which is why many privacy technologies have yet to gain widespread adoption.

Therefore, Secret Network, as the first smart contract public chain with privacy features, brings new possibilities to the industry.

From the project itself, as the first privacy public chain within the Cosmos ecosystem, it is also currently the most developed privacy public chain in the ecosystem.

This chain starts with privacy functionality, building a dedicated infrastructure for privacy in the Web 3.0 era. The project has now established a complete cross-chain bridge infrastructure, and the ecosystem is gradually enriching.

Currently, Secret Network has raised two rounds of funding:

On May 6, 2021: Secured strategic funding of $11.5 million from Arrington XRP Capital, Blocktower, Spartan Group, and Skynet Trading Ltd.

On January 19, 2022: A $400 million ecosystem fund from SCRT Labs, DeFiance Capital, Alameda Research, CoinFund, HashKey Group, Hashed, Arrington XRP Capital, Dragonfly, Distributed Capital, Skyvision Capital, Blocktower, Terraform Labs, Hartmann Ventures, NGC Ventures, Figment, and ArkStream.

Starkware: A Layer 2 Unicorn with a $6 Billion Valuation Increase in Six Months

Blockchain privacy solution provider StarkWare, headquartered in Netanya, Israel, has co-founders Eli Ben-Sasson and Alessandro Chiesa, who are also founders of ZCash.

Its main goal is to further promote the zk-Starks breakthrough blockchain privacy solution developed by the Technion – Israel Institute of Technology.

It continues to use zero-knowledge proof protocols to protect information privacy on the blockchain, supporting the compression of massive data into smaller samples.

On the other hand, it is more efficient, transparent, and secure than quantum computing. One major advantage is that it ensures computational integrity while proving private information without consuming a large amount of computing power.

Starkware currently has two products:

1. StarkEx provides customized ToB services for applications, allowing applications running on StarkEx to customize their business logic.

StarkEx serves applications such as DeFi and gaming, speeding up transaction times, lowering transaction costs, and enabling data availability through either ZK-Rollup or Validium solutions.

2. StarkNet is a permissionless, decentralized, censorship-resistant general layer 2 network where any user and developer can deploy smart contracts written in Cairo.

These two products correspond to two different business models: the former provides customized services to applications and sells them, while the latter offers permissionless general services and charges transaction fees on the network or extracts MEV based on transaction fee priority as a node.

The Starkware team is from Israel, with key members being computer science and cryptography developers from Hebrew University and the Technion, making it one of the strongest teams in the field of zero-knowledge proofs.

From Starkware's official website, it can be seen that the team currently has 77 members, along with 7 subject advisors and 5 other advisors. Key members include:

Eli Ben-Sasson: Co-Founder & Chief Scientist, PhD in Theoretical Computer Science from Hebrew University, long-term researcher in computational integrity, cryptography, and zero-knowledge proofs. Professor of Computer Science at the Technion. Founding scientist of Zcash, inventor of zkSNARK and zkSTARK.

Uri Kolodny: Co-Founder & CEO, Bachelor's in Computer Science from Hebrew University, a commercially experienced and collaborative serial entrepreneur.

Alessandro Chiesa: Co-Founder & Chief Scientist, Professor of Computer Science at UC Berkeley. Founding scientist of Zcash, co-inventor of zk-SNARKs, and core developer of the leading open-source library for succinct zero-knowledge proofs, libsnark.

Michael Riabzev: Co-Founder & Chief Architect. PhD from the Technion, previously worked at Intel and IBM.

Oren Katz: Vice President of Engineering. Graduated in Computer Science from Hebrew University, MBA from Tel Aviv University, and a senior engineer with 20 years of experience.

In terms of financing, StarkWare has disclosed seven rounds of funding, involving 45 investments, with a disclosed funding amount of $273 million.

On May 25, 2022, StarkWare, the zero-knowledge proof developer for the Ethereum Layer 2 scaling solution StarkNet, completed a $100 million Series D funding round at a valuation of $8 billion, leading the competition in Ethereum scaling solutions.

It is worth noting that in November 2021, StarkWare had just completed a $50 million Series C funding round led by Sequoia Capital, with a valuation of $2 billion, meaning that in just six months, StarkWare's valuation increased fourfold, jumping by $6 billion.

Recently, due to a series of upgrades on Ethereum, the Layer 2 boom has resurfaced. Given the superiority of Starkware's technology, I am very optimistic about the long-term development of zk-rollup and STARK.

In the future, with the incentive effects brought by token releases and the gradual shift of the network towards decentralization, Starkware will be one of the strongest competitors in the Rollup sector.