Blockchain infrastructure startup Arch Labs raises $13M from Pantera to bring native smart contracts to Bitcoin

Bitcoin may be the most valuable asset in crypto, worth over $2 trillion. However, using it for anything beyond payments is still a hassle. Developers looking to build DeFi apps or mint NFTs have to rely on centralized exchanges or awkward bridges to other blockchains, which often adds unnecessary risk and friction.

Bitcoin infrastructure startup Arch Labs is working to fix that. The startup just raised a $13 million Series A round led by Pantera Capital, bringing its total funding to $20 million and pushing its valuation to $200 million. The goal? To make Bitcoin programmable, without compromising on the core principles that made it trusted in the first place.

$13M Series A Fuels Arch Labs’ Push to Make Bitcoin Programmable

At the center of this effort is ArchVM, a virtual machine that allows developers to build smart contract-like applications directly on Bitcoin’s base layer, without bridges or wrappers. Think decentralized swaps, lending, Bitcoin-backed stablecoins, NFTs, and even games—all secured by Bitcoin itself.

The funding comes just ahead of Arch Network’s mainnet launch, expected this summer. At launch, users can expect a range of on-chain applications: AMM swaps, lending platforms, DAOs, and gaming integrations—all built directly on Bitcoin.

“The potential of Bitcoin has always been immense, but its programmability has remained limited by design,” said Matt Mudano, CEO of Arch Labs. “With Arch, we’re introducing a solution that respects Bitcoin’s foundational principles while significantly expanding its capabilities. Our focus on liquidity, user experience, and security makes Arch uniquely positioned to unlock Bitcoin’s full potential as a programmable financial system.”

Pantera Capital led the latest round, with participation from existing backers like Multicoin Capital, Portal Ventures, OKX Ventures, CMS Holdings, Tangent, and Big Brain Holdings.

Franklin Bi, General Partner at Pantera Capital, added, “By introducing smart contract functionality directly into Bitcoin’s Layer 1, Arch creates a pivotal execution platform enhancing Bitcoin’s existing framework instead of splitting its liquidity and potential. This strategic addition allows Bitcoin to tap into areas of blockchain utility, such as dApps and programmable contracts, where it had previously ceded ground to Ethereum and Solana.”

So, how does it all work?

Arch’s architecture is made up of three parts:

• ArchVM: A custom virtual machine that supports state changes and complex off-chain computations, allowing for Turing-complete contracts on Bitcoin with high throughput, similar to what developers get on Solana.

• Decentralized Validator Network: Uses Proof-of-Stake consensus to coordinate and finalize smart contract interactions while maintaining decentralization.

• FROST + ROAST Multisig: The first real-world implementation of these advanced signature schemes to enable secure multi-party key management without a single point of failure.

This setup lets developers deploy applications that tap directly into Bitcoin’s liquidity and security, without needing to bridge assets elsewhere. Assets remain on Bitcoin’s base layer and can still communicate with other programs on the network.

Arch Labs is betting that this kind of simplicity will appeal to builders who’ve long wanted to do more with Bitcoin without having to leave it. And with a fresh round of funding, the team now has the resources to push that vision into reality.