Blue, which offers know-your-customer (KYC) and anti-money-laundering (AML) identity verification products for traders on decentralized-finance (DeFi) protocols, has come out of stealth with $3.2 million in funding.
The announcement comes as interest in DeFi, a term used to refer to lending, trading and other financial activities carried out on a blockchain without traditional middlemen, has reached new heights in the wake of centralized cryptocurrency exchange FTX’s collapse late last year and a series of crypto exchange bankruptcies earlier in 2022.
Blue will use the funding to complete security audits from Halborn and Verilog Solutions. The rest of the money will go into expanding Blue’s core team and bringing the company’s permissioned DeFi product to market in the first quarter.
The company has already begun working on several proof-of-concept projects with major DeFi protocols, which it will announce in the coming months, Blue co-founder and CEO Casper Yonel said.
Reg S refers to a Regulation S offering that allows a company to issue equity or debt and to use an online method to raise capital from U.S. investors
Blue has built out its permissioned DeFi offering, which assigns “Blue IDs” to users who are then verified by a team of credential issuers.
The company was the finalist at the ETHDenver ‘22 Hackathon last March. Since then, the firm has also participated in other programs such as Outlier Venture’s DeFi Base Camp Accelerator, crypto exchange Binance’s Most Valuable Builder program and Startup with Chainlink’s incubator.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.