Icelandic blockchain startup Monerium has closed a US$2 million seed funding round led by the Nordic VC fund and Crowberry Capital, with participation from New York-based blockchain software technology company, ConsenSys, and Hof Holdings. Monerium will use the proceeds of the seed round to accelerate the development of its services, the company said on Friday.

Founded in 2016 by a team of serial entrepreneurs, academics as well as financial services and central banking veterans, Monerium aims to “make currency accessible, secure and simple to transact … by issuing asset-backed, redeemable and regulated e-money on blockchains.” The startup has applied to become a fully licensed financial institutions across the European Union through a wholly-owned subsidiary.

“Monerium has a clear vision to bridge fiat money and blockchains. It was when working with ConsenSys shortly after the launch of Ethereum, that we first identified e-money as a key catalyst for mainstream blockchain adoption,” explained Sveinn Valfells, CEO of Monerium.

“Becoming a licensed financial institution is the next key step for Monerium in order to assume full responsibility for and control over the complete range of functions required to issue e-money on blockchains: asset management, compliance, risk management, and product development.

“Drawing on our extensive experience of financial services and technology, we are confident that we can enable our customers to store and transmit fiat funds safely and efficiently on blockchains, permissioned or permissionless.”

ConsenSys’ investment in Monerium is one of the first investments facilitated by Coven, a new, open, co-venturing initiative. Commenting on the Monerium deal, Andrew Keys, co-founder of ConsenSys Capital, said:

“ConsenSys is dedicated to supporting companies building the infrastructure needed for a more decentralized and self-sovereign future. Monerium’s work in tokenizing currencies across Europe is an exciting endeavor we’re glad to be a part of.”

Headquartered in Reykjavik and employing 14 people across Iceland, Sweden, the US and the UK, Monerium started out in September 2016 with the goal of offering fiat money on the Ethereum blockchain. According to the company, introducing blockchain and decentralization in the financial system could help prevent systemic financial crises.

“In Iceland in 2008, a centralized financial system collapsed and almost caused a systemic economic meltdown. The ‘too-big-to-fail’ banking institutions were a single point of failure for deposits, lending, and payments. Despite what happened in 2008, global finance is still largely dependent on centralized institutions and systems, and there remains a distinct lack of competition,” said Jon Helgi Egilsson, chairman of Monerium and former chairman of the Central Bank of Iceland.

“We believe the solution is to bring about greater decentralization. By becoming an asset-backed, regulated, and redeemable e-money provider for blockchains, Monerium will help to decentralize global finance, which will offer customers more options to store and send e-money, while simultaneously supporting financial stability.”