Bitcoin-Powered Marketplace OpenBazaar Raises $3 Million

The developers behind OpenBazaar, the open-source marketplace protocol powered by bitcoin, have raised $3m in new funding.

The new round was led by BlueYard, a Berlin-based VC fund with a focus on early-stage startups that has strongly indicated its support for decentralized markets in the past. VC giants Andreessen Horowitz and Union Square Ventures also took part.

OpenBazaar is like a decentralized eBay, connecting buyers and sellers directly through an application-based marketplace. But instead of PayPal or credit cards, the market utilizes bitcoin as a medium of exchange.

The project grew out of an earlier iteration, dubbed DarkMarket, which won the Bitcoin Expo hackathon in Toronto in 2014.

OpenBazaar 2.0

The new funding comes more than a year after the startup that develops OpenBazaar, OB1, raised $1m in seed funding from Andreessen Horowitz, Union Square Ventures and angel investor William Mougayar, who sits on the startup’s board.

The round caps a busy year for OB1, which officially launched the service in April following months of testing. Some of the early listings on the market included caramel waffles, accommodations in Taiwan and marijuana seeds.

According to OB1 CEO Brian Hoffman, the next year should be just as busy.

He said of the new funding:

“After launch we were so excited to see how people have been using OpenBazaar, and with this new funding we’re confident it will allow us to bring the benefits of truly free and open trade to the world.”

Hoffman told CoinDesk that the funding will help the startup continue expanding its suite of services, describing it as a kind of “seed 2.0” round.

Major items in the pipeline include OpenBazaar 2.0, along with plans to develop value-add services (with an eye to monetization) and integrate with Tor, the anonymous communications network.

Bitcoin image via Shutterstock