Stablecoin Infrastructure Heats Up as Venture Investors Pour in Capital
As cryptocurrency prices reach unprecedented heights, venture investors are flocking to a lucrative corner of the blockchain industry: infrastructure for stablecoins. These digital currencies are designed to maintain a fixed 1:1 peg to traditional currencies like the US dollar, offering a more stable store of value and means of payment.
BVNK Raises $50 Million Series B Funding Round
UK-based stablecoin infrastructure company BVNK has secured a $50 million all-equity Series B funding round, led by crypto-focused megafund Haun Ventures, with participation from Coinbase Ventures and existing investor Tiger Global. This investment values BVNK at around $750 million, according to a source familiar with the deal.
A New Era for Stablecoins
The deal comes on the heels of the largest acquisition in the crypto industry’s history, where payments giant Stripe acquired stablecoin infrastructure startup Bridge for $1.1 billion. This landmark transaction has turned the heads of many generalist investors and fintech operators, who had previously dismissed blockchain companies.
BVNK: The Global Leader in Stablecoin Infrastructure
BVNK cofounder and CEO Jesse Hemson-Struthers describes his company as the “global leader” in the stablecoin infrastructure vertical. With operations dating back to 2021, BVNK has established itself as a pioneer in the space. “Every competitor of Stripe is coming to us saying, ‘Stripe’s done this, how can we get involved in the space now?’” Hemson-Struthers notes.
The Promise of Stablecoins
Stablecoins have emerged as a beacon of hope for the crypto industry, offering a more stable holding for investors and everyday people without access to traditional currencies. However, the high cost and difficulty of moving between fiat currencies and stablecoins have hindered their adoption as a payment system.
Infrastructure Companies to the Rescue
Companies like BVNK and Bridge are working to address this issue by gaining state and national financial licenses, forming partnerships with on- and off-ramps between the fiat and crypto worlds, and making it easy for companies to adopt stablecoins for various use cases.
A Mainstream Moment for Stablecoins
Crypto advocates argue that stablecoins will eventually replace the cumbersome patchwork of international banking and payments systems, which are slow and expensive. “We’re obviously excited about the inflection point we’re seeing with stablecoins across this year,” says BVNK investor and Coinbase Ventures vice president Shan Aggarwal. “It’s the mainstream moment.”
BVNK’s Unique Value Proposition
While BVNK will inevitably draw comparisons to Bridge, both in terms of product offering and valuation, Hemson-Struthers and his investors are quick to distinguish between the two companies. BVNK has a one-year head start on Bridge, and has focused on the European and Asian markets, with plans to launch in the US in January.
A Substantial Business Built
BVNK has built a substantial business through high-profile clients like Deel, a US payroll and outsourcing startup that uses BVNK to pay thousands of contractors globally. According to Hemson-Struthers, BVNK has an annualized revenue of $40 million and processes $10 billion in annualized transaction volume.
A Catalyst for Growth
The Bridge acquisition served as a catalyst for BVNK’s new funding round. Haun Ventures general partner Diogo Mónica, who had previously invested in BVNK as an angel investor, led the Series B round. Despite Bridge’s rapid acquisition by Stripe, Mónica and Aggarwal insist that they intend for BVNK to keep growing independently.
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