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Coinbase Co-Founder Backs Blockchain Startup's $3 Million Seed Round

Coinbase Co-Founder Backs Blockchain Startup's $3 Million Seed Round

A startup that is developing a protocol based on the ethereum blockchain to allow users to validate information across different datasets has raised $3 million in seed funding.

Called DIRT, the San Francisco-based company said Wednesday that notable investment firms taking part in the round include Digital Currency Group, Pantera Capital, China-based Zhenfund and InBlockchain. Individual investors such as Linda Xie and Coinbase co-founder Fred Ersham also participated.

With the new financing finalized, DIRT's founder Yin Wu told CoinDesk in an interview that the protocol – also called DIRT  – will be released in the next three to four months, together with a token that will be based on the ethereum standard ERC-20.

Wu said that the goal of the protocol is to serve as a platform where third-party decentralized application (dapp) developers can create what is called a token curated registry (TRC) – a similar concept to the way in which Wikipedia uses the community to update and verify its data. In essence, a TRC is a distributed data list focused on a certain topic that allows users to propose and validate what information should be on the list, using tokens to vote and back up positions.

Wu further explained:

"If anyone in the network finds misinformation, they can also challenge the dataset and say this is incorrect. In order to initiate a challenge, you need a stake token. The challenge then begins with a vote. Anyone in the network can vote with tokens. ... Whoever wins the vote, wins the tokens; if you lose the vote or voted for the wrong side, then you are penalized."

The company has not yet decided how it will distribute its tokens, however – though it will seek to do so as widely as possible. Wu did say the token should have a "strong utility angle," since it is used to "adjudicate whether information is correct."

In addition, the company said upon the protocol's release that it will also launch a decentralized application that is developed internally, but declined to disclose more information for now.

Leigh Cuen contributed reporting.

Dollars image via Shutterstock

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Source:
https://www.coindesk.com/coinbase-founder-backs-blockchain-startups-3-million-seed-round/