Digital identity startup Netki, Inc., which provides secure cryptocurrency payment systems, announced that it raised $3.5 million USD in a seed round led by O’Reilly AlphaTech Ventures today. Joining the round was Donuts, Colle Capital, The Husseini Group, Digital Currency Group, Plug and Play, Base Ventures, Tom Turney, and Bitcoin exchange Bitfinex.

Founded in 2014, Netki focuses on providing security and privacy for cryptocurrency transactions—including Bitcoin, Ethereum, Tether and others. The function behind the service is not just a wallet for virtual currency but also a way to easily address a wallet in a human-readable fashion—similar to the Domain Name Service (which makes IP addresses readable) but for wallet addresses instead with the company’s “Wallet Name Lookup” service.

To do this, Netki combines the Namecoin blockchain and Secure DNS (DNSSEC) to provide lookup services between name and a cryptocurrency wallet address.

Currently Bitcoin wallet addresses are extremely difficult to remember—for example, 1ARpEWrsoxPUAVDe22cXk3zpNkX1RHNMz7, would send bitcoins to me. As a result, clients handle these addresses, often by bookmarking them for users, and QR codes or copy/paste is used to provide addresses to merchants or payment senders. To overcome this problem with IP address the Domain Name Service (DNS) network was designed that makes the World Wide Web work; right now Bitcoin and other cryptocurrencies have no similar commonly adopted network.

In an interview with Bitcoin Magazine, Netki CEO Justin Newton explained that the vision of the company was to become the “e-mail addresses of cryptocrrency” so that services could hand out wallet names similar to how popular free e-mail services worked such as Gmail, Yahoo and Hotmail.

Already, ChangeTip’s tip.me domain name is an example of this service. ChangeTip (ChangeCoin, Inc.), a Bitcoin microtransaction tipping service, partnered with Netki in 2015 to integrate its service and now uses it to produce human-readable tipping addresses.

Netki is also accessible via Microsoft’s Azure cloud-based Blockchain-as-a-Service (BaaS) platform, allowing developers using the Azure BaaS to integrate Netki’s wallet identity services for wallets. As a result, with the API delivered via the BaaS, it should be possibly to easily add human-readable wallet names to any application that could use them.

Cryptocurrency identity services industry still in infant stage

There are very few identity services in the cryptocurrency industry at this point working in the same space that Netki is attempting to enter.

One similar identity service to Netki is OneName from Blockstack, a blockchain identity service designed to allow users to sign up and identify themselves on a publicly accessible peer-to-peer ledger along with socially identifying information. For example, you can find the me on OneName at onename.io/kytdotson.

Newton argues that Netki differs from OneName because the Netki service embraces privacy over public publication of information (which is how OneName disseminates identity). He says that he believes that Netki’s vision is to allow people to easily share their wallet addresses without having to publish it to everyone first.

“We’d love to see OneName support Wallet Names where they currently support bitcoin addresses,” Newton told Bitcoin Magazine in 2015.

Featured image credit: Pixabay.