Sorella Labs, a forward-thinking crypto startup, has successfully raised $7.5 million in seed funding, with Paradigm leading the investment round. The company is focused on developing tools to address the Maximum Extractable Value (MEV) issue on the Ethereum network. Other key investors in this round include Nascent, Uniswap Ventures, Robot Ventures, and Bankless Ventures.
Sorella Labs has introduced the Brontes tool, which is designed to detect MEV activities and process Ethereum blocks more efficiently. In addition, the company has developed Angstrom, a tool that integrates with Uniswap V4. Angstrom utilizes Sorella’s off-chain network to conduct auctions that determine transaction order, aiming to prevent arbitrage opportunities that could exploit the system.
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Strategic Support
Led by Paradigm, with significant participation from other prominent investors, the seed funding round was closed in September 2023. However, Sorella Labs only made the announcement in August 2024, after emerging from stealth mode with the launch of its Brontes MEV tool. According to Sorella’s CEO, Ludwig Thouvenin, internal analysis following Ethereum’s September 2022 Merge upgrade revealed that over $855 million had been lost to malicious MEV actors.
Collaboration with Flashbots
The San Francisco based Startup has been working closely with Flashbots, another Paradigm-backed firm, to combat the MEV problem on Ethereum. While Flashbots focuses on solutions at the protocol level, Sorella targets the application layer, offering complementary approaches to the issue. Thouvenin emphasized the significant impact MEV has had on decentralized exchanges, particularly through complex arbitrage and sandwich attacks, which have undermined trust in the Ethereum ecosystem.
Future Expansion and Vision
Currently, Sorella Labs employs a team of 15, based in Manhattan, and plans to expand by hiring systems engineers, MEV researchers, and Rust developers. Thouvenin believes that Sorella’s approach could significantly reduce the negative impact of MEV on the Ethereum network, preventing common strategies like sandwich attacks and front-running. By doing so, Sorella aims to create a more equitable and efficient environment for DeFi users in the evolving landscape of Ethereum.
