Rhinestone Raises $5 Million in Seed Funding

Rhinestone, a startup focused on modular smart account infrastructure, has successfully raised $5 million in seed funding.

Funding Details

Crypto-focused investment firm 1kx led the funding round, supported by CoinFund, Lattice, Heartcore, Circle Ventures, Alchemy Ventures, zkSync, and Cyber. Additional participation came from angel investors affiliated with Biconomy, WalletConnect, WorldCoin, Lit Protocol, and Pimlico.

The recent seed financing increases Rhinestone’s total funding to $5.42 million, as confirmed by a company spokesperson to The Block.

Smart Accounts Infrastructure

Rhinestone specializes in developing infrastructure for smart accounts—digital wallets governed by smart contracts rather than traditional private keys. These accounts function as programmable platforms, enabling activities directly within the user’s account, contrasting with conventional wallets like Metamask, Rainbow, and Coinbase Wallet.

Modular Smart Accounts

Modular smart accounts are part of the expanding field of account abstraction, a concept introduced in Ethereum’s Improvement Proposal 4337 last year. This new standard enhances wallet capabilities by incorporating features such as multi-party transaction signing, fee subsidies, and enhanced security measures like two-factor authentication.

Rhinestone provides developers with tools to enhance smart account features through self-contained modules. Their ultimate goal is to improve interoperability, security, and other functionalities of smart contracts. Additionally, Rhinestone is developing a platform for developers to distribute and monetize their modules, intended for both end users and decentralized app (dapp) developers. They previously partnered with Biconomy to establish a Module Store.

Future Plans

With the recent funding, Rhinestone aims to grow its team, enhance its smart account infrastructure, and expand its developer incentive program.

Kurt Larsen, Rhinestone’s co-founder, explained, “In three to five years, we believe smart accounts will be the dominant interface for any autonomous onchain actor, whether a user, an AI agent, or a terminal in a blockchain-integrated supply chain.” He emphasized that modules allow for endless extensibility of smart accounts, unlocking new capabilities while preserving self-custody and security. The endorsement from industry leaders like Circle, Alchemy, Safe, and zkSync significantly supports their vision.

1kx and Lattice also participated in Rhinestone’s pre-seed round, announced in December 2023, which included support from Safe, Heartcore, EigenLayer’s Chief Strategy Officer Calvin Lui, Axelar co-founder Georgios Vlachos, and Lau Ventures’s Waikit Lau.