Borrowing Crypto With DeFi? TransUnion Shares Real-world Credit Scores

TransUnion is paying close attention to the crypto ecosystem, now connecting DeFi protocols with real-world credit scores


JHVEPhoto/Shutterstock, modified by Blockworks


Crypto users can soon provide their credit scores when making blockchain-based credit applications via major US credit bureau TransUnion.

TransUnion’s new crypto-focused service will provide individuals’ credit scores to blockchain dapps when they apply for DeFi loans. Their scores will be based on their credit histories.

“Credit scoring is an important tool for lenders to help mitigate risk regardless of the platform being used,” Jason Laky, TransUnion’s executive vice president of financial services, said in a statement

Blockchain data platform Spring Labs and Web3 identity solution provider Quadrata partnered with TransUnion on the initiative. In 2021, TransUnion led a $30 million investment in Spring Labs’ Series B.

Consumers can request their credit data from Chicago-headquartered TransUnion, which they will then choose to share with the relevant dapp. TransUnion says user privacy will be preserved in the process.

The partnership will allow DeFi lenders to access “critical information when making their lending decisions with confidence, ultimately minimizing their risk, and providing borrowers more opportunity for better terms,” Laky added.

TransUnion crypto push strengthens case for DeFi

TransUnion’s crypto move comes after one of worst sell-offs in history following the collapse of algorithmic stablecoin ecosystem Terra last year.

Roiled markets exposed lenders to unsecured loans threatening their balance sheets. This type of high-risk lending led to a wave of defaults that left several crypto companies anxious about the ensuing domino effect.

The transparent nature of DeFi could mitigate those concerns in future scenarios, proponents say.

“As more consumers and lenders move to blockchain to conduct business, it’s important to ensure that the balance is struck between the information that lenders need to assess risk and the privacy and anonymity expected by users of the technology,” said John Sun, CEO of Spring Labs, in a statement.

“This new product featuring TransUnion’s identity and credit data at its core is a big step toward achieving that balance and allowing more lending opportunities on blockchain while minimizing risk.”

Credit scores in Web3 aren’t a new concept. Quadrata previously partnered with nine DeFi protocols including TrueFi and Cred Protocol to provide KYC and anti-money laundering risk scores. 

And last year, a credit risk assessment startup Spectral raised $23 million to build and refine its credit scoring network.

Don’t miss the next big story – join our free daily newsletter.


Upcoming Events

Hilton Metropole | 225 Edgware Rd, London

Mon - Wed, March 18 - 20, 2024

Crypto’s premier institutional conference returns to London in March 2024. The DAS: London Experience: Attend expert-led panel discussions and fireside chats Hear the latest developments regarding the crypto and digital asset regulatory environment directly from policymakers and experts.

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Research report - cover graphics (1).jpg


In this report, we dive into crypto private market data to gather insights on where the future of the industry is headed. Despite a notable downturn in private raises, capital continues to infuse promising projects that aim to transform payments, banking, consumer experiences, community, and more, with 2023 being the fourth-largest year for crypto venture capital.


BUZZ holds shares of Coinbase, Robinhood and MicroStrategy


Opinion: Even though I didn’t pay for my “Diamond Hands” burger with BTC, don’t let that fool you into thinking that crypto’s development is futile


The results mark “a major positive inflection point,” one analyst says, as the exchange carries net income momentum into a crypto rally


While the slate of 10 US spot bitcoin funds have tallied $4.6 billion of net inflows thus far, half of the field is lagging the leaders


Trading volumes totalled $154 billion in Q4, including $125 billion in institutional volume


DeFi on Bitcoin is all the rage right now and Stacks is positioned to benefit