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Privacy emerges as crypto’s next 'killer app,' with Arc, Canton and Tempo topping $1 billion in funding

New fundraising rounds for three institution-focused blockchains show how regulation, privacy and corporate competition are reshaping crypto infrastructure, according to Bitwise CIO Matt Hougan.

By Will Canny, AI Boost|Edited by Stephen AlpherUpdated May 12, 2026, 4:37 p.m. Published May 12, 2026, 4:33 p.m. 2 min readMake preferred on _Bitwise CIO Matt Hougan (Suzanne Cordiero/CoinDesk/Shutterstock)

What to know:

• Arc, Canton and Tempo have collectively raised more than $1 billion at valuations topping $10 billion.
• Bitwise CIO Matt Hougan said privacy features could become essential as crypto moves into mainstream finance.
• The fundraising boom highlights how U.S. stablecoin legislation is accelerating institutional investment in blockchain infrastructure.

Arc, Canton and Tempo, three blockchains focused on stablecoins and tokenization, have raised more than $1 billion combined, highlighting rising institutional demand for privacy-focused crypto infrastructure, according to Bitwise CIO Matt Hougan.

Stablecoin issuer Circle (CRCL) recently raised $222 million at a $3 billion valuation for Arc, while Digital Asset is reportedly raising $300 million at a $2 billion valuation for the Canton blockchain. Tempo, backed by Stripe and Paradigm, previously raised $500 million at a $5 billion valuation.

In a Tuesday blog post, Hougan said the fundraising wave reflects three trends: clearer U.S. regulation, growing demand for private blockchain transactions and rising competition from corporate-backed crypto networks.

Blockchains have long faced a trade-off between speed, cost and security: faster, cheaper networks often make compromises on decentralization or resilience, while more secure chains can be slower and more expensive to use.

That tension is especially important for stablecoins and tokenization, where institutions need transactions to be fast and affordable, but also private, compliant and secure enough for real-world finance.

Hougan said privacy could emerge as a “killer app” for crypto as businesses and consumers become less comfortable with fully transparent blockchains like Ethereum and Solana.

“If you're a business broadcasting every trade before it's complete, or a worker whose paycheck is visible to anyone with a block explorer, that transparency is a bug, not a feature,” Hougan said.

He added that the fundraising boom also reflects growing confidence after Congress passed the Genius Act in 2025, giving institutions a clearer regulatory footing to invest in crypto infrastructure.

PrivacyCircleStripeCantonBitwiseAI Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk's full AI Policy.More For You

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By Krisztian Sandor|Edited by Nikhilesh De2 hours agoThe global banking giant is expanding its tokenized money market lineup, following BlackRock's similar move just a few days ago.

What to know:

• JPMorgan filed to launch a new tokenized U.S. Treasury money-market fund on Ethereum.
• The fund, dubbed JPMorgan OnChain Liquidity-Token Money Market Fund, is designed to meet reserve requirements for stablecoin issuers under the GENIUS Act.
• The move adds to Wall Street asset managers' growing push into tokenized real-world assets.

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