Cryptocurrency startup Fireblocks raised $ 133 million in a Series C financing round.
The investment round was led by venture capital firms Coatue, Ribbit and Stripes, with strategic investment from BNY Mellon and Silicon Valley Bank.
Michael Shaulov, CEO of Fireblocks, said that the cash injection will allow the company to expand the settlement infrastructure needed to integrate new customers as the adoption of encryption heats up:
“Although we have no plans to become a bank, we believe that our infrastructure will lend itself perfectly to driving an entirely new era of financial services.”
On his company’s investment in Fireblocks, Ribbit Capital’s Micky Malka said: “We are on the verge of the greatest transformation the world financial system has ever seen”, adding that Fireblocks is at the “forefront of this revolution”.
Series C funding is generally directed towards more developed projects that have already achieved a reasonable degree of success. These companies require additional capital to help expand their products and services in new markets or even to acquire other businesses.
Fireblocks was founded in 2018 by veterans of Israeli military intelligence, including Michael Shaulov, who previously co-founded a mobile security startup, Lacoon Mobile Security. The company specializes in custody of digital assets and also works to accelerate the speed of digital transactions. According to the Wall Street Journal, the latest round of financing raises Fireblocks’ valuation to more than $ 900 million, with the company raising a total of $ 179 million so far.
Fireblocks has been a magnet for venture capital firms looking to capitalize on the growing institutional demand for Bitcoin (BTC) and other cryptocurrencies. Prior to its fundraising for the C Series, Fireblocks had already raised a cumulative $ 179 million from investors such as Galaxy Digital, Swisscom Ventures, Paradigm, Tenaya Capital and Cyberstarts.
Through Fireblocks, banks and fintech companies can connect to the cryptocurrency market by offering custody, tokenization, asset management, trading, loan and payment solutions. Since its creation three years ago, the company claims to have secured $ 400 billion in digital assets on behalf of its customers. Its institutional clients include Nexo, Celsius, BlockFi, Salt and Coinsquare.
BNY Mellon is not the only banking institution that is preparing to launch its own custody encryption solution. Deutsche Bank is also planning to enter the custody crypto business, in addition to offering token trading and issuing services.
Bryan Routledge, associate professor of finance at Carnegie Mellon University, said that custody cryptography is not much different from the traditional services already offered by traditional banks. Storing a pair of public and private keys is important, “but it’s not that difficult,” or it shouldn’t be for most banks, he said.
Additional reporting by Sam Bourgi.