Mobile-focused crypto payments start-up Celo has received a funding boost, after Andreessen Horowitz’s cryptocurrency fund A16z Crypto and venture capital firm Polychain Capital invested $25 million in the start-up.
In an announcement on Tuesday (02/04/19), Celo revealed that A16z Crypto had purchased $15 million USD and Polychain Capital $10m USD in Celo’s Gold Tokens project.
The Celo Gold Token is described as “deflationary” cryptocurrency, which aims to reduce price volatility. Celo also offers the Celo Dollar – a stablecoin pegged to the US dollar.
“Tokens in circulation are backed by a diversified, over-collateralized, and publicly auditable crypto-asset reserve,” says the company on its website.
Celo “mobile-friendly” protocol
Celo says that its protocol is designed to be “mobile-friendly” and “ultralight” and enables funds to be sent to cellphone numbers.
The company’s mission statement says that it aims “to remove the barriers for large-scale adoption of cryptocurrencies as means-of-payment”.
“The first application launching on our platform is a social payments and money transfer app, aimed at developing markets.”
The company say that its technology makes sending payments “as easy as sending a text to anyone anywhere”.
“Celo maps phone numbers to wallet addresses using a novel decentralized address-based encryption algorithm – mobile participants can earn rewards for securing and maintaining the system.”
A spokesperson for Celo said:
“We strongly believe that anyone, regardless of their location or socio-economic status, should have access to basic financial tools for storing and transmitting currency.”
The company added that initially it aims to help unbanked or under-banked individuals and enable easier remittances, cash-transfer programs and micropayments through an open-source platform.
Celo said that “several other leading institutions” worldwide has participated in its token-based funding initiative, but the sums involved remain undisclosed.
Celo has also recruited leading players in the industry to help establish itself in the crypto space, including the former head of financial institution partnerships at Circle, Chuck Kimble, who joined the company in February this year. Celo has also acquired as its general counsel Brynly Llyr, formerly of Ripple.
The company says that the technology its employs is based on “the same proven distributed ledger technology that powers Bitcoin and Ethereum and allows for the issuance of efficient digital currencies that are secure, immutable, non-counterfeitable and interoperable”.
Easy-to-use wallet app
In line with its mission to remove the barriers for large-scale adoption of cryptocurrencies as means-of-payment, Celo has recently piloted an “easy-to-use wallet app” in Argentina and Tanzania. The app would enable verified users and merchants to send and receive small payments.
Celo said it would also be launching a public testnet of its platform in summer 2019.
The firm said in its investment statement on Tuesday that it now has more than 40 contributors to the project internationally – including the World Bank Group and the UN, as well as tech companies Google, Microsoft and Apple, and financial companies such as PayPal and Morgan Stanley.
Celo added that academics are also involved – including staff at MIT and the universities of Stanford, Harvard and Berkeley.
Mobile payments image licensed via Shutterstock.