Bitmain, Polychain Raise $10.7 Million SAFT For Encryption Startup NuCypher
In a simple agreement for future tokens (SAFT) led by Polychain Capital, NuCypher, an encryption start-up, raised $10.7 million. The company launched its public testnet to mark the occasion.
The primary product of NuCypher is focused on proxy re-encryption, which enables files to be encrypted to many users and allows administrators to grant or revoke access based on specific criteria. The company dates back to 2015, but in 2017 it started looking at tokens as a way to decentralize its infrastructure.
NuCypher had one of 2017's buzzy initial coin offerings (ICOs), but eventually, the company chose not to pursue a public token sale. Instead, it ran one SAFT for $4.4 million in 2017.
MacLane Wilkison, co-founder and CEO of NuCypher, said that the new SAFT would be launched as the company nears mainnet:
Other round participants include Bitmain, Bitfury, Y Combinator Continuity Fund, Compound VC, DHVC, Hashed, Arrington XRP Capital and CoinFund.
This investor round has decided to lock their tokens for staking nodes running the NuCypher program. The protocol decentralizes by rendering encryption computations allowing nodes to receive tokens. Nevertheless, if they are found to be malicious, the investors will forfeit their stakes.
Participants in the latest SAFT purchased 8% of the initial 1 billion ERC-20 token inventory, with 31% sold in the previous $4.4 million round
A mix of new token emissions and network costs will be charged to node operators. Like many other networks, inflation will diminish over time as fees increase with usage.
NuCypher has run a hackathon with CoinList to promote app development, and several minimally viable apps are now live. This includes Stridon, for paid blogging; Snowden for posting on social media so your friends can't read it; and NuBox for encrypted file storage.