Decentralized finance startup Conduit today announced it has raised $17 million in a new funding round led by Portage Ventures to help financial institutions connect to the crypto economy.

Also participating in the seed round were FinVC, Gemini Frontier Fund, Diagram Ventures, Discovery Ventures, Jump Crypto and others.

Conduit’s clients are traditional financial institutions looking for a “conduit” into the crypto economy and it provides this by suppling application programming interfaces that allow them to provide DeFi products to their customers. With Conduit, companies can seamlessly integrate DeFi products within their own platform and provide a customer-friendly experience by using APIs that simplify compliance and development.

DeFi is an emerging financial technology based on blockchain distributed ledgers and cryptocurrencies that removes the need for middlemen in token transactions by being primarily driven by software-controlled smart contracts. The popularity of blockchain and cryptocurrencies have made the DeFi market a multibillion-dollar opportunity but the apps involved are extremely technical and difficult to implement.

“At Conduit, we’re solving the problem of unequal access to financial services,” said Kirill Gertman, co-founder and chief executive of Conduit. “The average person doesn’t have a way to earn on their savings, especially with interest rates being low and inflation on the rise. DeFi can be an earning opportunity, but is extremely difficult to understand and access for the mainstream consumer.”

The first two services that Conduit’s APIs provide to clients include growth earnings accounts and a corporate treasury. With DeFi-enabled interest-bearing accounts, companies can offer customers a simple way to invest in high-yield, decentralized finance with a single click. Corporate treasury permits companies a simple way to add crypto to their coffers through secure, high-yield crypto-backed holdings.

All of Conduit’s services are fully regulated and compliant with local laws, meaning that clients can use its APIs as connectors to create their own DeFi products for their customers without further frustration. That greatly simplifies the onboarding process from traditional finance into decentralized finance for neobanks, fintechs, exchanges and traditional banks.

“There has been unprecedented interest in DeFi this past year, but still huge hurdles for the average consumer to access this new economy,” said Stephanie Choo, a partner at Portage Ventures. “The Conduit API will allow a whole new set of consumers to participate directly from platforms they already use.”

Statistics regarding the DeFi market, which includes crypto tokens across numerous blockchains, reached $240 billion in locked-in value as of January this year, up from $26 billion at the beginning of 2021, according to DeFiLlama.com.

Although Conduit began its journey in Canada, Gertman said that the company intends to use the new funding to expand its operations into Latin America and soon the U.S. He also said that he believes these are “two key markets driving the DeFi revolution.” The new financing will also be used to work toward general availability so any business can use the APIs.

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