Fabric Systems

About Fabric Systems

Fabric Systems, also known as Fabric Cryptography, is a hardware company founded in 2021 by Michael Gao, Tina Ju, and Sagar Reddy. Gao, the CEO, previously founded the photonic AI company Luminous Computing and has been involved with Bitcoin since 2011, when he started a mining operation from his dorm room. He and co-founder Tina Ju are both MIT and Stanford dropouts, while co-founder Sagar Reddy brings over two decades of experience in full-custom chip design and systems architecture.

The company initially focused on developing hardware for the cryptocurrency sector, announcing two main products following a $13 million seed round in October 2022. The first is a highly efficient, liquid immersion-cooled ASIC machine for Bitcoin mining, engineered to achieve an energy efficiency of 20 watts per terahash. This design submerges the hardware in a specialized liquid for cooling, a departure from traditional fan-based air cooling, aiming to outperform existing miners in energy consumption. The second product is a computer processor designed for advanced cryptographic algorithms like Zero-Knowledge Proofs (ZKPs).

More recently, the firm has sharpened its focus on accelerating complex cryptographic operations beyond just mining. It is developing what it calls a Verifiable Processing Unit (VPU), a new class of general-purpose, programmable processor designed specifically for cryptography. This VPU, powered by the company's FC1000 chip, is intended to provide the performance of an ASIC with the flexibility of a GPU to support various cryptographic algorithms as they evolve, including ZKPs and Fully Homomorphic Encryption (FHE). In September 2024, Fabric announced a collaboration with Polygon Labs to accelerate the development of real-time ZK-proofs for Polygon's AggLayer, with Polygon Labs committing to a $5 million investment in VPU-based server systems.

The business model centers on selling this specialized hardware directly to clients in the blockchain and enterprise sectors. The company has reported receiving tens of millions of dollars in pre-orders for its VPU, which is expected to enter mass production in 2025. The primary market is the blockchain industry, which has an immediate need for efficient ZK-proof generation, but the long-term vision is to bring these privacy and trust technologies to enterprise applications in finance, AI, and medtech.