Austin-based tech startup tokenproof bags $5M in seed funding to protect and bring NFTs to the real world
In less than two years, non-fungible tokens (NFTs) have gone from just a fad to a multi-billion dollar market. There’s an increase in mainstream and institutional adoption of NFTs as major brands like Nike and Visa enter the space.
The NFT market is expected to grow by $147 billion over the next five years. However, using NFTs still comes with substantial risks for users, and logistical challenges for brands. That’s because to unlock the value of an NFT, a user typically has to connect their digital wallet to use their tokens, exposing not just the required NFT, but all other assets in the wallet. That’s why Austin, Texas-based tokenproof has set out to remove this risk by creating credentials that serve as proof of ownership of a digital wallet and its assets.
tokenproof eliminate the risk of connecting your wallet just to prove ownership of your tokens. The startup has developed safe token-gating solutions that enable users to prove ownership of NFTs without connecting or even carrying their wallets.
Today, tokenproof announced it has raised $5 million in a seed funding round led by Penny Jar Capital, with participation from Corazon Capital, 6th Man Ventures, Canonical Crypto, and prominent angels including Sebastien Borget, Mark Cuban, Keith Grossman, and Patricio Worthalter.
Founded in 2022 by Alfonso (Fonz) Olvera, tokenproof lets users enjoy the benefits of NFT ownership in a secure way that respects privacy, while also making it easy for brands to leverage tokens as an extension of their brand – whether that’s accessing exclusive events, retail experiences, online services, membership benefits, or more.
In a statement, Fonz said: “Eliminating the unnecessary risk of connecting or carrying a digital wallet is crucial for mainstream use of NFTs. We are dedicated to delivering the security and privacy users deserve while making it seamless for companies to unlock the possibilities of NFTs and connect with people in compelling and creative ways.”
After a one-time verification of a user’s digital wallet, tokenproof issues a proof of ownership credential, while the actual wallet remains securely disconnected. The tokenproof mobile app creates dynamic QR codes to authenticate and unlock the value of NFTs; whether that’s access to an invite-only event, a membership benefit, or a retail experience – in the real world or online. Companies using tokenproof for verification can customize the experience with flexible authentication rules, such as VIP access, discounts, or exclusive content.
At this year’s NFT NYC, the leading non-fungible token conference, tokenproof powered over 75 events, including the Bored Ape Yacht Club’s ApeFest, delivering a frictionless experience for both attendees and hosting companies, and establishing tokenproof as the go-to ticketing solution in Web3.
“The tokenproof team were amazing partners and a joy to work with,” said Kerem Atalay (EmperorTomatoKetchup), co-founder of Yuga Labs. “Stoked to see where they’re headed from here and can’t wait to work with them again.”
The funding follows the company’s success at both physical and virtual events and will fuel the expansion of additional use cases for NFT verification, including online services, and retail experiences.
“We believe NFTs will transform how brands connect with customers, but only with seamless on-ramping and greater security,” said Bryant Barr, co-founder of Penny Jar Capital. “Fonz and team are solving this massive Web3 problem by creating a safe way to realize the value and benefits of NFT ownership.”