Fireblocks has raised a $133 million Series C funding round led by Coatue, Ribbit and Stripes. The company provides several products that let you store, transfer and issue digital assets. In particular, Fireblocks provides custody to institutional investors — it currently stores $400 billion in cryptocurrencies.
BNY and SVB Capital are also participating in today’s funding round. Existing investors Paradigm, Galaxy Digital, Swisscom Ventures, Tenaya Capital and Cyberstarts Ventures are investing once again.
Overall, Fireblocks has raised $179 million since day one. The company says it has yet to reach a valuation of $1 billion — it isn’t a unicorn yet, but not far from it.
The startup doesn’t have a consumer-facing product. Instead, it sells its products to banks, fintech startups and other financial institutions. As interest rates have been close to 0% for a while, financial institutions are looking for a solution to store cryptocurrencies and diversify their balance sheet.
Fireblocks lets them do that securely. The company uses multi-party computation to handle private keys. When you create a wallet, cryptographic secrets are generated on your device and on the servers. Whenever you’re trying to initiate a transaction, multiple secrets are used to generate a full public and private key. This way, there’s no single point of failure.
The company has also put together a network of liquidity partners. You can connect directly with 30 different exchanges and initiate transfers from there. That’s why over-the-counter trading desks and market makers also use Fireblocks to settle trades across several exchanges.
Fireblocks also lets you issue and manage tokens. It can be particularly useful if you want to issue stablecoins, tokens that are backed by fiat currencies and don’t fluctuate over time against their fiat value. It works across multiple blockchains as well.
You can earn staking rewards on Ethereum 2.0, Polkadot and Tezos through integrations with Staked or Blockdaemon. There’s a DeFi API so you can take advantage of the most interesting DeFi protocols.
The company also integrates with compliance providers Elliptic and Chainalysis for anti-money laundering reasons. The company can flag and reject transactions depending on a set of rules.
As you can see, Fireblocks provides plenty of integrations with the crypto ecosystem at large. Starting from scratch and building those integrations in house would require a ton of resources, especially if cryptocurrencies aren’t the core element of your business.
In many ways, Fireblocks reminds me of banking-as-a-service companies, except that Fireblocks focuses on crypto assets. And today’s funding round proves once again that there are a lot of investments happening in the crypto industry right now. PayPal acquired Curv just a couple of weeks ago. And this acquisition is certainly helping other crypto infrastructure companies prove that they’re valuable.
DeFi aims to bridge the gap between blockchains and financial services
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