Regtech Startup TRM Raises US$1.7M for Crypto Compliance Solutions

Regtech Startup TRM Raises US$1.7M for Crypto Compliance Solutions

By Diana Ngo - min read
Updated 22 May 2020

TRM Labs Inc., a regtech startup based in San Francisco, has raised US$1.7 million in a seed funding round led by Blockchain Capital with participation from Tapas Capital, Green D Ventures, The MBA Fund, and strategic angel investors. The company will use the funds to scale its engineering talent and expand the capabilities of its platform, it said on Thursday.

Founded in 2017, TRM Labs builds enterprise applications, developers tools and intelligent protocols for startups and teams to launch and grow blockchain-based products.

Commenting on the new capital injection, Esteban Castaño, CEO and co-founder of TRM Labs, said:

“We believe that cryptocurrency is going to be a democratizing force in the world that lets anyone exchange value and access financial services. But to get there, we need to make it easier for everyone to be compliant.

“Just as the Internet led to an explosion of new content, crypto is leading to an explosion of new financial products and markets. We need regulatory and compliance infrastructure that scales with this new world.”

TRM Labs’ first product is Token Relationship Management (TRM), a platform the uses machine learning to help clients manage relationships with their customers, and detect and block suspicious activity. The platform was designed to streamline on-chain anti-money laundering (AML) compliance for digital asset companies and includes solutions for on-chain customer due diligence, transaction monitoring, and customer relationship management.

TRM Labs is also building tools that use machine learning and millions of data points to automatically detect fraudulent activities like money laundering and market manipulation.

The company recently rolled out its analytics solution with TrustToken’s TrueUSD stablecoin. TrustToken is using TRM to accurately segment core user groups and identify which exchanges and channels are driving growth.

“The founders of TRM, Esteban Castaño and Rahul Raina, have deep experience across enterprise software, blockchain, and product design,” said Spencer Bogart, general partner at Blockchain Capital. “We think TRM can significantly accelerate crypto’s adoption by helping issuers and exchanges increase trust by being compliant on Day 1.”

TRM co-founders, Rahul Raina and Esteban Castaño
TRM co-founders Rahul Raina and Esteban Castaño

Blockchain Capital, formerly Crypto Currency Partners, is a venture capital firm that invests in blockchain-related companies. It was founded in 2013 by Bart Stephens, Bradford Stephens and Brock Pierce and has backed the likes of Civic, Circle, Coinbase, Paxos, formerly itBit, ShapeShift, Xapo and the 0x open protocol.