Decentralized messaging protocol XMTP hits $750 million network valuation with $20 million Series B

Ephemera, the core developer behind the decentralized messaging protocol XMTP, has raised $20 million in a Series B funding round, as it looks to build and grow its ecosystem.

The round was co-led by Union Square Ventures, a16z crypto, and Lightspeed Faction, with additional participation from Coinbase Ventures, Offline Ventures, Sound Ventures (founded by Ashton Kutcher and Guy Oseary), and Distributed Global.

The Series B round comes nearly four years after Ephemera's $20 million Series A in 2021. Co-founder and CEO Shane Mac told The Block the company held off on raising again because it still had "significant" runway. While it wasn't in urgent need of capital, the decision to raise was driven by a long-term strategic vision and a desire to avoid short-term decision-making in what can be a highly speculative market.

The round, structured as equity with token warrants, began in the fall of 2024 and closed shortly after, Mac said. It brings Ephemera's total funding to $49.9 million, including a prior $9.9 million seed round. The Series B values Ephemera at a $300 million post-money equity valuation and a $750 million network valuation for the broader XMTP protocol that will have a token, Mac said.

"The network valuation reflects the broader value of the XMTP protocol ecosystem, including its decentralized infrastructure and community," he noted.

As part of the investment, Union Square Ventures managing partner Fred Wilson has joined Ephemera's board of directors, becoming its first outside board member.

"Today, messaging is controlled by a handful of large companies and is completely siloed. XMTP is rebuilding it from first principles: secure, decentralized, identity-native, and open for developers," Wilson said in a statement. "It's the protocol layer for the next generation of messaging applications."

XMTP relaunches inside Coinbase's new Base app

XMTP allows secure, end-to-end encrypted messaging between identities — starting with wallet addresses — and is designed to plug into web and mobile applications. Mac described it as offering "Signal-grade" encryption, passkey authentication, and native transaction capabilities. XMTP's public testnet with independent node operators has been live since February of this year, and mainnet launch is slated for later this year, Mac said.

Previously available as an "experimental feature," XMTP is now being relaunched inside Coinbase's new Base app (formerly Coinbase Wallet). The relaunch marks a strategic shift from an opt-in messaging tool to a core part of the Base experience. "This means users will have native, secure messaging capabilities built directly into their crypto experience, making communication integral," Mac said.

According to Ephemera, XMTP enables developers like Coinbase to build secure chat experiences around financially motivated communities — whether it's investing with peers, joining prediction markets, or sending money globally.

Mac added that XMTP's next phase goes beyond messaging: it's about action. New agent integrations — like Bankr, Flaunch, and Onit — are transforming chat threads into functional crypto interfaces, he said.

"Bankr, for example, is a trading companion that lives in your Coinbase Wallet inbox— you can send money to everyone in the group anywhere in the world instantly for free," he noted. Flaunch enables token sales inside chats, while Onit allows users to bet on real-world events and receive automatic payouts.

To support XMTP's growth, Ephemera plans to expand its team across protocol development, decentralized infrastructure, and product design, Mac said.

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