Crypto Exchange Coinbase Acquires Digital Identity Startup Distributed Systemsbr>
Decentralized identity startup Distributed Systems has been acquired by crypto exchange Coinbase. The financial terms of the deal were not disclosed.
Distributed Systems is building an operating system for decentralized applications, placing users in control over their data and privacy. The startup believes user-controlled persistent identities provide a foundation for digital citizenship and a critical step in advancing consumer privacy and security.
With the acquisition, the Distributed Systems team will be working with Coinbase to find new and innovative ways to validate and verify identities as cryptocurrency goes more mainstream. Coinbase believes that “decentralized identity systems represent a transformative shift in our relationship with technology.”
“Blockchain technology that powers cryptocurrencies offers a new way to let us all be “verified” everywhere we go on the internet, feeling safer about our interactions with others and opening the door to the experiences that require trust,” said Coinbase Identity project manager B Byrne.
Coibase, however, hasn’t committed to developing digital identity tools of its own with the purchase of Distributed Systems. Byrne said that Coinbase will be “deliberate about how and where we apply this technology.”
“We’re going to have new questions to answer about anonymity, privacy, and how permanent the different pieces of our identity should be, Byrne said. “But ultimately, decentralizing online identities will transform our relationship with technology.”
Nikhil Srinivasan, CEO and Co-founder of Distributed Systems, said that the company was deciding between going to “Facebook, or Robinhood, or Binance, or Coinbase,” having been in formal talks with at least one of the first three. He said the startup opted to go with Coinbase because the exchange “was able to convince us they were making big bets, weaving identity across their products.”
“We strongly believe this move will push us closer to our shared mission: to build an open financial system for the world,” Srinivasan said.