Entropy, a16z-backed decentralized custody startup, is winding down and returning capital to investors
Decentralized custody startup Entropy, backed by a16z, is shutting down and returning its $27 million in total funding to investors.Summary
Entropy, a decentralized custody startup founded by Tux Pacific and backed by Andreessen Horowitz (a16z) in a $25 million seed round in 2022, is winding down operations and returning capital to its investors. Pacific cited four years of building, several pivots, and two layoff rounds, ultimately concluding that the business model was not venture-scale after an initial feedback request.
Entropy initially aimed to be a decentralized alternative to centralized custodians, using multiparty computation for secure, rule-based crypto asset management. The company had raised approximately $27 million in total funding. Pacific, known for their unconventional background as a self-taught cryptographer, transgender advocate, and self-described "anti-capitalist anarchist," expressed that they had done their best work and decided to close the company.
This closure reflects a broader downturn in the crypto sector, with venture deal counts falling significantly in 2025. Pacific plans to take a break before potentially pivoting away from crypto entirely to focus on innovating hormone delivery pharmaceuticals for menopausal and trans women.
(Source：The Block)