Paxos Labs, a financial utility stack for digital assets incubated within Paxos, announced a $12 million funding round on April 14, 2026. The company enables one integration to embed yield, enable borrowing, and launch branded stablecoins. Blockchain Capital led the round, with participation from Robot Ventures, Maelstrom Fund, and Uniswap Labs.
Funding Overview
Paxos Labs secured $12 million in a funding round led by Blockchain Capital, with participation from Robot Ventures, Maelstrom Fund, and Uniswap Labs. This announcement adds to the latest web3 fundraising updates, highlighting continued investor interest in institutional-grade digital asset infrastructure. Bhaumik Kotecha declined to disclose the company’s valuation, with the announcement made on April 14, 2026. The startup emerged as a spin-off from Paxos, a leading provider of stablecoin and blockchain infrastructure. Chad Cascarilla serves as CEO of both Paxos and Paxos Labs, reinforcing the strategic alignment between the parent company and its newly independent venture.
About the Company
Paxos Labs provides a single software suite for developers. The suite allows creation of branded stablecoins. It enables customers to earn interest on holdings. Users can borrow money using those tokens as collateral.
Paxos Labs originated from Paxos Labs initiatives focused on DeFi. DeFi refers to financial markets running on blockchains without centralized intermediaries. Bhaumik Kotecha cofounded Paxos Labs. Kotecha previously worked at Paxos for over three years. He started his career at Block, the fintech company founded by Jack Dorsey.
Kotecha developed technology to simplify integration into DeFi markets like Aave. Paxos decided to spin off the project due to its institution-focused roadmap and DeFi regulatory ambiguity.
Current customers include neobank Hyperbeat. Developers behind privacy-focused blockchain Aleo also use Paxos Labs services. Kotecha stated the startup expects to break even by year-end.
Investors
- Blockchain Capital led the investment in Paxos Labs. Spencer Bogart, a general partner at Blockchain Capital, commented on market gaps for stablecoin holders seeking to deploy assets.
- Robot Ventures participated in the funding round for Paxos Labs.
- Maelstrom Fund, the family office, invested in Paxos Labs.
- Uniswap Labs, the DeFi developer, joined the round as an investor.
Market Context
Paxos Labs operates in the stablecoin and DeFi sectors, where stablecoins peg to real-world assets like the U.S. dollar and facilitate faster payments and lower fees. Banks and fintech firms, including Stripe, are also showing growing interest in stablecoins.
Paxos established itself as a white-label stablecoin issuer, with major companies such as PayPal and Nubank using its services. As more organizations issue stablecoins, they increasingly seek ways for customers to utilize them in DeFi. To address this demand, Paxos recently agreed to acquire crypto wallet company Fordefi for more than $100 million, a move aimed at expanding client access to decentralized finance.
Kotecha noted the technology simplifies smart contract integration. Paxos Labs teams assist with compliance and risk expression. Bogart highlighted demand for putting stablecoin deposits to work in on-chain markets. Kotecha added that declining interest rates make on-chain deployments more appealing.
