AllianceBlock, a chain-agnostic blockchain project, is partnering with Pangolin, a community-driven DEX powered by Avalanche. AllianceBlock’s business is building compliant and data-driven products to enable financial institutions to access opportunities in decentralised finance (DeFi). With this partnership, AllianceBlock hopes to bridge the gap between DeFi and traditional finance (TradFi) – by remedying issues that exist in each of the ‘spheres’ and linking them more closely together.
According to Justin Trollip (of Pangolin), “being able to rely on a streamlined solution for compliance opens new opportunities for our decentralized exchange in user acquisition and institutional investment in a sustainable and future-proof way. At the same time, it preserves the freedom to choose compliance levels for our current users. We’re excited to be a part of AllianceBlock’s broader ecosystem. Both teams have seen the value in working together as we continue to expand.”
Background to the AllianceBlock and Pangolin partnership
As institutional interest grows there is n increasing need for the observance of compliance requirements in DeFi across various jurisdictions. At the same time, there is an increase in conflicting rules between regulators. Without this, access to liquidity from financial institutions will remain limited.
In this context, AllianceBlock will help Pangolin:
- grow in line with DeFi regulatory developments
- make institutional access easier.
At the same time, AllianceBlock’s compliance framework will mean that Pangolin’s current users can choose their level of identity verification.
Expanding opportunities for both AllianceBlock and Pangolin
By building on its existing collaboration with Ava Labs, Pangolin wishes to expand opportunities at the intersection of institutional and decentralised finance. Its exchange will integrate AllianceBlock’s Trustless KYC and Identity Verification product into its platform.
By leveraging GBG’s identity data intelligence software, users prove their identity in a trustless manner only once. Subsequently, they can initiate sales and other activities without having to share personal information with multiple providers.
As part of this, Pangolin will:
- become a node validator for AllianceBlock’s Bridge
- integrate into the Liquidity Mining as a Service program
- open up an ecosystem of projects that can benefit from its white label fundraising solution.
AllianceBlock will add an optional compliance layer to Pangolin’s services through its Cross Border Regulatory Compliance Layer. Cumulatively, AllianceBlock’s solutions will support Pangolin by inviting more retail and institutional investment onto its decentralised exchange in what should be a scalable, compliant, and sustainable way.
Rachid Ajaja, CEO and Co-founder of AllianceBlock, said “Events in recent weeks make it crystal clear: regulation is coming to DeFi. As such, companies need to be prepared. One of the greatest challenges to DeFi projects today is making sure they are globally compliant.
“DeFi’s global nature means this can be difficult to uphold across various jurisdictions with conflicting rules. Our products will allow Pangolin to be ready to onboard institutional clients in line with regulatory requirements and to stay ahead of the game, while at the same time giving their users the freedom to choose.
“Our goal at AllianceBlock is to bridge DeFi and TradFi. This is a perfect example of how we are working with leading projects in the space to achieve this. We look forward to extending our full product to Pangolin and the wider Avalanche ecosystem in the future.”
Enterprise Times: what does this mean
The AllianceBlock team is made up of ex-JP Morgan, Barclays, BNP Paribas, and Goldman Sachs investment bankers, as well as software entrepreneurs. Since inception, AllianceBlock has joined the London Stock Exchange Group’s Partner Platform and announced DeFi industry partnerships with:
- Ocean Protocol
- Injective Protocol
- Orion Protocol
In the Pangolin partnership, AllianceBlock’s compliance solutions will be implemented on separate subnets of Pangolin. Users will be able to choose which networks they interact with and whether – depending on the jurisdiction – they want to use the compliance service or not. At the same time, users can choose their level of anonymity depending on their operational jurisdiction.
With such flexible approaches, Pangolin hopes it can grow by enabling ‘TradFi’ players to bring liquidity into its platform.