Blockchain unicorn Paxos acquires Fordefi for over $100 million
The U.S. firm plans to expand its Israeli R&D hub as it integrates Fordefi’s institutional wallet technology serving 300 financial institutions.
Blockchain infrastructure unicorn Paxos is acquiring the Israeli startup Fordefi. The companies did not disclose financial details, but Calcalist has learned that the purchase price exceeds $100 million.
Fordefi, founded in 2021 by Josh Schwartz (CEO), Dima Kogan (CTO), and Michael Volfman (VP R&D) and operating in Tel Aviv and New York, develops security infrastructure and institutional wallets for managing digital assets. The company serves nearly 300 financial institutions, with monthly activity volumes exceeding $120 billion. Fordefi employs about 50 people, including roughly 35 in Israel, and all employees will remain with the company following the acquisition.
“All of our R&D activity in Tel Aviv will remain central to Paxos, and we will recruit many more employees and build new products together,” said Dima Kogan, CTO and co-founder of Fordefi.
Fordefi has raised $28 million to date, $18 million in its Seed round and an additional $10 million in a Seed extension, from investors including Lightspeed, Electric Capital, Castle Island, Pantera, Microsoft, and PayPal. The startup developed technology for managing and securing digital assets for institutions, combining advanced security capabilities with broad connectivity to blockchain-based commerce applications and sophisticated permission-management tools for organizations.
“In blockchain security, there are many players in different segments,” Kogan told Calcalist. “In our world, there are many institutional players, and we positioned ourselves as the company providing solutions for decentralized trading. That’s how we reached 300 customers, because we offer the safest solution with secure connectivity for blockchain-based trading. The founders, employees, and investors are all registering a profit and coming out very satisfied.”
He added: “Paxos provides the regulatory framework that allows companies to use blockchain, and we bring technological reinforcement. Together we will offer solutions to many companies that have been searching for exactly this. Our business activities will continue as usual, and Paxos sees us and our customers as strategically important.”
Paxos, which last raised capital in 2021 at a valuation of $2.4 billion, said it will maintain and expand its development activities in Israel as part of its strategy to build the critical infrastructure layer that will allow organizations to hold digital assets, issue stablecoins, and process blockchain-based payments securely and under strict regulatory oversight.
Charles Cascarilla, co-founder and CEO of Paxos, said: “We built Paxos as a neutral and regulated platform for the world’s largest organizations joining the digital economy. Fordefi has developed impressive technology and a broad customer base through convenient APIs and advanced Web3 capabilities. The market now needs a regulated platform that provides a complete solution for the wide range of digital asset needs. Together we are bringing customers a world-leading unified solution.”
