Passbase Raises $13.5M to Build ID Verification System for Crypto Firms

Passbase, an identity verification infrastructure company, has raised $13.5 million in a funding round led by Costanoa Ventures. The startup will use the funds to scale its operations and build a policy and workflow manager that sits on top of its ID verification system.

The capital came from a new $10 million Series A round and a previously unannounced $3.5 million seed round. Other participating investors included Lakestar, Eniac Ventures and Cowboy Ventures.

Passbase helps companies automate the identity verification process to meet regulations for anti-money laundering (AML), know your customer (KYC) and age restriction requirements around the world. The developer-focused product covers over 6,000 IDs across 190 countries and 15 languages.

The new policy and workflow manager offers industry-specific policy templates and privacy-centric infrastructure to help companies keep up with fast-moving and complex regulatory environments worldwide.

Silicon Valley-based Passbase was launched in 2018 after the founders’ previous app, the crypto wallet Coinance, ran into regulatory hurdles.

“We built Passbase to solve our own problem back in 2018 to allow users to manage their digital identities across different cryptocurrency platforms in a compliant way,” said Passbase CEO and co-founder Dave McGibbon in the press release. “This round of funding brings us one step closer to being the trusted identity solution for Web 3 companies like Coinance.”

Identity verification regulations have proven challenging for cryptocurrency companies. Over the summer, a group of crypto giants that included Coinbase and Gemini drafted a solution for the Financial Action Task Force (FATF) provision called the “travel rule,” which requires the sharing of a customer’s personally identifiable information when regulated firms move crypto around.