KR1 (LON:KR1 ) told investors that it has invested a total of US$75,000 in Union Finance, a credit mutual built on Ethereum.
Union Finance allows people and organisations to take out loans on the blockchain without the need for collateral, a credit score, or revealing personal information on a public ledger.
The blockchain and cryptocurrency investor said it will receive a yet-to-be-determined amount of discounted tokens from this seed round participation.
KR1 was joined in the Union seed round by 1kx, CoinFund and a number of prominent Ethereum DeFi angel investors, this morning’s statement outlined.
At present, Ethereum operates using a decentralised finance ‘DeFi’ ecosystem that relies on heavy over-collateralisation making some projects capital inefficient.
The group said Unions’ unsecured lending protocol opens up the system to a larger set of use cases, for example micro-loans, credit lines within the Internet of Things and social lending.
“With around US$1 billion locked up in the DeFi ecosystem, it has grown considerably in the past 12 months, and we expect it to grow further,” said Keld van Schreven, Managing Director & Co-Founder of KR1.
“Union is exactly the type of DeFi project KR1 likes to back. It is a new, innovative platform to open up uncollateralised lending to everyone and represents a paradigm shift for DeFi,” he added.
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