Bulgaria-based BitLendingClub has gotten a €200,000 ($253,394) injection of seed funding, provided by venture capital firm LAUNCHub.
The venture hooks up lenders and borrowers looking to transact in p2p fashion with bitcoins. Current interest rates average about 17.6% per annum.
The credit card-like interest rates are reflective of a decentralized lending model which carries a high level of counterparty risk. To help reduce risk, BitLendingClub has brought on Jumio, which lets you “turn your customer’s computer or smartphone into a credit card scanner.” Jumio enlists Netverify, who verifies online and mobile identities in real-time, effectively providing a near-instantaneous know-your-client (KYC) function. Customers are be able to scan their ID document with their device camera.
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Earlier this year, Europe-based bitcoin vendor Safello enlisted Jumio’s services to streamline its KYC process.
The company has facilitated over 2200 loans worth over 3500 BTC ($1.2 million) since launching in May. Currently, there are 459 active loans. A 2% loan fee is charged.
Though based in Europe, the service is looking to compete with BTCJam, more established in this space. A key challenge may be security, with BTCJam having experienced multiple hackings over the past year.
For a detailed list of recent investment and M&A activity in the crypto industry, please visit the DC Magnates Crypto Deal Table.