Dragonfly, Scalar are backing a startup that calculates DeFi ‘credit scores’
An upstart crypto project is looking to add a bit more trust to the generally “trustless” market for decentralized finance.
ARCx revealed its new “DeFi Passport” Tuesday. With the DeFi Passport, users can leverage their on-chain activity to prove their creditworthiness and thus qualify for additional benefits across various crypto protocols — similar to how high credit scores can help investors clinch lower rates.
The project has clinched the backing of a number of big investors in the crypto market, including Dragonfly Capital and Scalar Capital. Those crypto funds poured $1.3 million in a recent round for the firm alongside LedgerPrime. To date, the project has raised $8.2 million.
A user’s passport score will be based on a scale from 0 to 999, with the 999 score “being the most lucrative,” according to a press release.
In an interview with The Block, ARCx founder Kerman Kohli said that projects can leverage the product to offer high score DeFi-era higher allocations or more leverage. “You can create a yield farming strategy that only targets users with the highest score,” he said.
“The vision moving forward is to make the ARCx DeFi Passport and Credit Score a key lego-block within Decentralized Finance,” the release added. “Beyond the initial proof of concept with the ARCx Credit Score, the opportunities for pseudonymous profiling and scoring of identities based on on-chain activity in a decentralized manner are endless.”
© 2021 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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Author: Frank Chaparro
