Hi all, Julie here.
Happy Friday and the start of a long weekend. I highly encourage everyone to support a Black-owned small business on Monday (and every day). It’s a small but great step towards supporting a cause that MLK fought for years ago.
Second, I’d love it if you could fill out this FTT Content Survey over the weekend. You’ll be entered to win a free hat :)
Third, I had a great convo with Jonah Crane from Klaros Group on Thursday. We talked a lot about regulation in the crypto space, which is something that many of us will be keeping a close eye on this year. Just yesterday, I wrote about how both the SEC and CFPB recently brought on crypto skeptics to advise on policy. Since these are two of the only agencies with confirmed leaders right now, they’ll likely be the ones driving policy. That’s a big deal.
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Company News
Current Takes Aim At Inflation
The New York challenger bank is rolling out a new product with a 4% APY on the first $6k in deposits in hopes of making a play on inflation. The “Interest” offering will be available to all Current users, including those on its free Basic plan as well as Premium users who pay to access upgraded features for $4.99 per month. While there isn’t a direct deposit requirement, the funds of up to $6k must be spread out across different “savings pods” that have limits of $2k. Since free users only have access to one pod, they will only be able to earn interest on up to $2k in deposits.
Funding and Deals
New Funding to Make Crypto Onboarding Easier
This is wild. If you’ve ever participated in crypto before, you know that there are often weird phrases or codes that you MUST save otherwise you are fcked. This makes onboarding a royal pain. These “seed phrases” have contributed to the loss of nearly 20% of all Bitcoins in circulation, according to Singapore-based crypto infra startup Web3Auth. TWENTY PERCENT! Bring me back the “forgot password” button please. Web3Auth, a non-custodial key infrastructure solution for web3 apps and wallets, wants to solve these problems by leveraging social accounts and devices that mainstream users already own to enable users to manage their keys intuitively. Powered by the Torus Network, which is an open source, non-custodial, distributed key management network, Web3Auth builds on this infrastructure to make web3 authentication simple and intuitive to use. Anyways, we’re talking about this today because Web3Auth announced it has closed a $13M round led by Sequoia Capital India. The company added that in 2021, more than 300 applications and wallets selected Web3Auth to secure over 4 million users’ private keys.
Cuban, Vlad and Coinbase Back Seashell
Seashell, a startup building an investment app to offer high yields, announced a $6M seed round led by Khosla Ventures and Kindred Ventures. Coinbase Ventures, Solana Ventures, and individual investors including Mark Cuban, Robinhood CEO Vlad Tenev and entrepreneur Elad Gil also participated. The round also took the company out of stealth, with it planning to launch its investment app in the first half of 2022. The company promises to offer up to 10% yields, and all users have to do is connect their bank accounts and transfer money to the Seashell app. The company claims it can do this by converting fiat into stablecoins via "a licensed custodian." The stablecoins will then be deposited into DeFi protocols to generate high yields, and Seashell is also exploring off-chain lending to further generate high yields. Big thing to keep in mind: this is not FDIC insured.
Bolt’s New Round
First of all, how is Bolt announcing this round on a Friday? As Corentin Claisse pointed out in the FTT+ Slack, Bolt is big on four-day work weeks. I have questions. Anyways, the one-click checkout company announced a $355M Series E financing at an $11B valuation. This comes just three months after it took in $393M in a Series D funding. The company said that over the past year, it’s grown its GMV per merchant by 80% and saw increased accounts by 180% over 2020, while transactions grew 200% year over year.
Crypto Watch
Coinbase Makes Another Acquisition
Coinbase is acquiring Chicago-based futures exchange FairX in a move to fill a gaping hole in Coinbase’s trading platform. While other crypto exchanges have derivative offerings, Coinbase does not. FairX is already regulated by the Commodity Futures Trading Commission and offers margin trading and other products through established brokers like TD Ameritrade and E*Trade Financial, which could give Coinbase the edge it needs in getting a derivatives marketplace up and running. Volumes in the derivatives market reached $2.9T in December, according to CryptoCompare. Many US exchanges have stayed away from the fast-growing market due to regulatory uncertainty (which is still very much a concern), but more are starting to expand into derivatives. FTX.US, one of Coinbase’s U.S. competitors, similarly used an acquisition of LedgerX LLC’s parent company to gain a foothold last year. FairX is already regulated by the Commodity Futures Trading Commission and offers margin trading and other products through established brokers like TD Ameritrade and E*Trade Financial.
Square Moves Into Bitcoin Mining
In a string of tweets (Elon Musk isn’t the only one that announces things on Twitter…though it makes more sense for Jack Dorsey’s companies to do this), Block/Square’s general manager for hardware laid out the company’s plans for next steps in Bitcoin mining. The GM said the goal is to make Bitcoin mining more distributed and efficient from buying, to setting up, to maintaining, to mining. This comes after a series of tweets last year from CEO Jack Dorsey talking about how “Bitcoin mining should be as easy as plugging a rig into a power source.” The project is being incubated within Block’s hardware team, which is beginning to build out a core engineering team of system, ASIC, and software designers.
Together With Fintech Meetup
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Virtual, March 22-24. Startup rate available for qualifying cos. Get Your Ticket Now!
Career Corner
Strategic Partnerships at Ntropy
Ntropy is growing quickly and looking for a Strategic Partnerships Manager to build and oversee its partnerships program across the banking, fintech and broader technology ecosystem. You will have an opportunity to shape the partnerships strategy and culture from the start, and work very closely with clients and the CEO. It’s a proactive and super fast-paced setting, where you get to control impact and direction from the get-go. If this sounds like you, apply above!
Community Highlights
I LOVE these stats from our friends at Alloy.
Julie VerHage-Greenberg is the co-founder of Fintech Today, where she focuses on editorial content and brand. Prior to joining, she was Bloomberg’s first fintech reporter, covering Robinhood from before it was a billion dollar company, breaking the news that Plaid was acquiring Quovo, and interviewing executives on Bloomberg TV and at several large conferences.
