California-based crypto startup Sorella Labs has announced raising $7.5 million in its latest funding round anchored by tech investment firm Paradigm.
The round, which will be used to finance the expansion of the startup’s operations and development efforts, was also backed by a host of investors, including Nascent, Uniswap Ventures, Robot Ventures, and Bankless Ventures.
Sorella Labs is developing tools to mitigate Ethereum‘s Maximum Extractable value (MEV) problem. The company said it had developed the Brontes tool to identify MEV activities and process Ethereum blocks.
It also developed the Angstrom tool to integrate into Uniswap V4.
Sorella Labs CEO Ludwig Thouvenin highlighted the extent of the MEV problem, stating that over $855 million had been lost to malicious MEV actors, according to the company’s internal analysis.
Sorella Labs is working closely with Flashbots, another Paradigm-backed crypto firm that raised $60 million in a Series B round in 2023, reaching a valuation of approximately $1 billion.
While Flashbots addresses MEV at the protocol level, Sorella Labs targets the application layer to complement these efforts.
Sorella Labs, headquartered in Manhattan, currently employs 15 people and plans to expand its team by hiring systems engineers, MEV researchers, and Rust developers.
Thouvenin expressed confidence that Sorella’s approach could significantly reduce MEV’s impact on the Ethereum ecosystem, creating a more efficient and equitable environment for DeFi users.
Analysts said the launch of Sorella’s tools represents a critical step in addressing the challenges posed by MEV, as the company seeks to bring greater transparency and fairness to Ethereum’s decentralized finance landscape.