Karma3 Labs Raises a $4.5M Seed Round Led By Galaxy and IDEO CoLab to Build OpenRank, a Decentralized Reputation Protocol

Palo Alto, California, March 1st, 2024, Chainwire

Using OpenRank, developers and web3 companies can build consumer apps where people can discover, use, fund, read, or buy something on-chain without worrying about getting spammed or scammed.

Karma3 Labs has raised $4.5M in seed funding led by Galaxy and IDEO CoLab Ventures to build OpenRank, a decentralized reputation protocol. Using OpenRank, developers and web3 protocols can power consumer apps, communities and marketplaces with an open ranking and recommendation layer that provides users with security and peace of mind when making decisions onchain, without having to trust centralized gatekeepers. Some of the early use cases of OpenRank include leveraging a community rating system for App Marketplaces like Metamask Snaps; Ranking and Recommendation APIs for Lens and Farcaster; On-Chain discovery feeds for consumer apps and wallets; and reputation-based voting and governance.

Introducing trust and reputation mechanisms is critical to web3, just as it has been for web2, where there have been countless use cases in decentralized peer-to-peer utility. For example, Uber decentralized taxi services because of driver ratings; AirBnB decentralized hotels because of host ratings; eBay decentralized the shopping mall because of seller ratings; Reddit decentralized gated community forums because of user karma badges; Google allowed for the practical use of the decentralized web because of PageRank. However, none of these services were able to be fully decentralized because a single entity owned the reputation scores. To prevent centralized gatekeeping, there is a need for decentralized reputation mechanisms. Such reputation systems need to be open-source, permissionless, flexible to different contexts, and Sybil-resistant.

OpenRank solves for this in web3, creating a decentralized reputation mechanism that sets the foundation for a future where peer-to-peer interactions and collective community intelligence power a decentralized web of trust, rendering centralized gatekeepers obsolete. The protocol aims for a scenario where Twitter’s Community Notes like system was possible, but not owned by a single company, openly and cheaply accessible to any developer, who could define their own algorithm of choice.

“A decentralized internet characterized by fairness and transparency hinges on the…