The news: The US-based crypto as a service platform Fireblocks raised $550 million in a Series E funding round, quadrupling its valuation to $8 billion from six months ago.
The latest round, co-led by hedge fund D1 Capital Partners and Spark Capital, brings Fireblocks’ total raised since its 2018 founding to over $1 billion.
More on this:
- Fireblocks offers the infrastructure for financial institutions (FIs) and fintechs to launch crypto services, including custody, trading, and issuance of digital assets and stablecoins.
- Last year, Fireblocks grew exponentially, doubling the assets on its platform to $2 trillion. It claims to have grown its revenue sixfold, to between $50 million and $100 million, though it hasn’t given specific figures.
- Clients boosting its revenues include Bank of New York Mellon, Revolut, BlockFi, and eToro.
- It also benefited from diversifying its offering to include digital asset solutions beyond financial services—like helping ecommerce websites create NFTs on the back of their merchandise, per TechCrunch.
What this means:
- Other crypto infrastructure firms also recently saw major funding rounds this week, including Blockdaemon, which raised $207 million, and UK-based BCB, which raised $60 million. Investors are likely to continue pumping billions of dollars into crypto custodians and the broader blockchain industry.
- These raises highlight soaring blockchain funding and FIs’ surging interest in giving clients exposure to cryptos. In recent years, large incumbent banks including Morgan Stanley, JP Morgan, and Goldman Sachs have all invested significantly in crypto custody. Fireblocks cited a report by Gartner showing 20% of major organizations will use digital currencies by 2024, suggesting the adoption of cryptos will accelerate.
- Many fintechs are adding crypto as a service products to capitalize on growing demand, increasing competition in the space and likely leading to the blockchain landscape maturing.
- Recent buyouts of competitors—including PayPal buying Curv in March and Coinbase snapping up Israel-based Unbound Security in November—may mean opportunities arise for a big-money takeover of Fireblocks as payments giants look to grow their crypto custody infrastructure.