Harpie, the blockchain security firm once backed by Coinbase Ventures and Dragonfly Capital, has shut down its on-chain firewall business. The company cited financial difficulties as the reason for the abrupt closure.
“We attempted to create a theft-free crypto ecosystem, but unfortunately could not create a sustainable business model around it,”
Harpie wrote in a public post on X. The statement marked the end of the company’s effort to protect Ethereum wallets from theft through its signature on-chain firewall service.
Founded by Noah Chong and Daniel Chong, Harpie launched to safeguard crypto users from hacks, phishing attacks, and accidental transfers. The startup allowed users to create a trusted network of applications and wallet addresses. Any transaction outside this network would be flagged as theft and automatically blocked.
The company had raised $4.5 million in a 2022 seed round led by Dragonfly Capital. Coinbase Ventures and OpenSea also participated in the round. At the time, crypto-related theft had surged to $1.9 billion by July 2022, according to Chainalysis—up from $1.2 billion at the same point in 2021.
Harpie’s product was designed for the Ethereum blockchain, which has historically accounted for most digital asset theft. The firm charged a 7 percent fee on any asset it successfully recovered. It had planned to expand its services to group treasuries and institutional investors, to broaden its reach to other chains over time.
During the seed raise, Tom Schmidt, a general partner at Dragonfly Capital, said that Harpie’s security offering was “a necessity for the future of crypto” and “could not have come at a better time.”
Despite the shutdown, Harpie stated that all outstanding rewards from its referral program and Harpie Season 1 campaign will be honored. “Stay posted on our Discord for more information,” the company advised users on social media.
Users have also been instructed to disconnect their wallets from Harpie’s RPC endpoints. A utility tool to help move vaulted assets is expected to be released on the company’s website in the coming days.
The shutdown comes just weeks after North Korea-linked hacking group Lazarus stole more than $1.4 billion in ether from Bybit’s Safe cold wallet. The theft is the largest on record, according to the company’s internal assessment.
Harpie’s exit leaves a gap in on-chain security amid rising concerns over blockchain theft.
