Cytokine that inhibits the activity of BMP2 and BMP4 in a dose-dependent manner, and thereby modulates signaling by BMP family members. Contributes to the regulation of embryonic morphogenesis via BMP family members. Antagonizes BMP4-induced suppression of progesterone production in granulosa cells. Homodimer. Interacts with BMP2, BMP4 and BMP7, but has lower affinity for BMP7 than for BMP2 and BMP4. Binds heparin; this impairs the interaction with BMP2. Highly expressed in the ovary, followed by brain, spleen, colon, kidney and uterus. In ovary expressed in granulosa cells of selective early antral follicles. Expressed in commissural neurons in the developing spinal cord (PubMed:9639362). Expressed during the development of teeth and hair follicles (PubMed:26416033). Up-regulated by gonadotropin treatment. N-glycosylated. Belongs to the DAN family.