Posted In:

#443
Hands Up For Handouts

Published:

Jun 26, 2022

Author:

Cindy Grazer

Posted In:

Published:

Jun 26, 2022

Author:

Cindy Grazer

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Is FTX the JPM of this century? SkyBridge Capital's Anthony Scaramucci seems to think so. In response to FTX’s recent bailouts throughout the crypto industry, he commented that FTX CEO Sam Bankman-Fried (SBF) "is the new John Pierpoint Morgan – he is bailing out cryptocurrency markets."

Rewind to 1907 and we find a similar narrative when tracing investment banker J.P. Morgan’s decisions to bail out multiple major banks after a period of crisis. As crypto markets have come under strain, SBF has stepped up to assume this role in its modern-day form.

For context, SBF has built out an army of crypto companies and positions – through Alameda and FTX – which have become powerhouses for facilitating consumer crypto trading interest, and acting as the market-making backbone of that interest. SBF has been unwavering in deploying capital to early stage companies as well, such as Solana, and FTX just recently purchased 7% of Robinhood’s equity in a play to start going after the US stock market.

Most recently, FTX made a $250m loan to bail out crypto lender BlockFi, as well as a $485 million loan to Voyager Digital. While some have applauded these efforts to support what they’ve characterized as systemically important players, others believe that the ongoing “crypto winter” will have a positive outcome in weeding out underperforming companies.

Regardless of the public verdict, FTX seems to be here to stay in their newly minted position of crypto lender of last resort. The question then remains - who will be the next lucky, heavily stressed players to receive a handout?

Hands Up For Handouts

Portfolio News

Devron earns “Best AI Solution for Big Data” award - Congratulations to portfolio company Devron - the leader in data science for distributed and private data - on being selected as the winner of the “Best AI Solution for Big Data” award in the fifth annual AI Breakthrough Awards program conducted by AI Breakthrough, a leading market intelligence organization that recognizes the top companies, technologies, and products in the global Artificial Intelligence (AI) market today. Read more

RBC partners Plaid to offer API-led connectivity with fintech services - The partnership will allow RBC’s 17m customers to share their financial data through a direct API with the services on Plaid’s data network. The data access agreement will remove the need for credential sharing, “resulting in increased security and better protection of clients’ privacy”, RBC says. Read more

HSBC and UBS go live on Axoni Equity Swaps Network - Axoni announced that HSBC and UBS are now live on Veris, Axoni's distributed ledger network for equity swaps, joining a rapidly growing group of both sell-side and buy-side industry participants. Veris allows for all parties on a trade to match and confirm all trade terms upfront and remain synchronized on post-trade events such as amendments, positions, and cash flows through the lifecycle of the swap. Read more

Deloitte and NYDIG announce alliance to provide banking for all with bitcoin - NYDIG will work with Deloitte's blockchain and digital assets practice across multiple areas involving bitcoin products, such as banking, consumer loyalty and rewards programs, employee benefits and more. The alliance creates a centralized approach for clients seeking advice implementing Bitcoin products and services. It will help businesses to leverage the multi-disciplinary professional services of Deloitte, together with the comprehensive bitcoin financial and technology products and services provided by NYDIG. Read more

Hands Up For Handouts

Crypto billionaire Sam Bankman-Fried doles out credit lines to stem contagion - In a recent interview with NPR, Bankman-Fried said he has a responsibility to consider stepping in, “even if it is at a loss to ourselves,” to stem contagions and help the industry thrive. In addition to parallels being drawn between Bankman-Fried and John Pierpont Morgan in 1907, some are also comparing the recent moves to Warren Buffett providing support to Goldman Sachs in 2008. Read more

BlockFi inks $250m credit deal with FTX to ease liquidity fears - FTX CEO Sam Bankman-Fried said that his company takes seriously its duty to protect the digital asset ecosystem and its customers. The partnership with BlockFi follows Alameda Research, a trading firm founded by Bankman-Fried, lending crypto broker Voyager Digital $500m. The capital gives the firm more flexibility to mitigate current market conditions, Voyager CEO Stephen Ehrlich said in a statement. Read more

Industry News

Brazil’s Nubank plots consolidation in Latin America’s booming fintech sector - Latin America’s biggest digital lender Nubank is planning to take advantage of an impending shakeout in the region’s booming financial technology sector by scooping up acquisitions at bargain prices, according to its chief executive. As rising rates and tighter credit restrict flows of venture capital globally, there are warnings that some of the region’s start-ups may struggle, creating attractive targets. Read more

Shopify is betting on NFTs to unlock a new take on shopping - The ecommerce giant has a new service to enable customers to use NFTs to unlock special perks, products and real-world experiences with merchants. Last year Shopify added the ability for merchants to sell NFTs using Shopify so customers don’t have to go to another site to buy them. With this new product, Shopify is taking that a step further through what’s known as “token-gated commerce.” The NFTs can come from anywhere the merchants want. Read more

Binance.US eliminates spot trading fees on Bitcoin - The move - which effectively allows customers to trade spot bitcoin for the U.S. dollar, tether, USD Coin and Binance USD, or vice versa, without paying spot trading fees - is the latest example of how organizations—traditional brokerages and digital upstarts alike—are offering discounts or eliminating fees to attract individual investors. Read more

Facebook Pay officially rebrands to Meta Pay, details work on an interoperable “wallet for the metaverse” that will have “proof of ownership” - While Meta Pay is essentially the same tool as it was before, just with Meta branding, Zuckerberg says the company is working on something that will let users manage their identities, items, and payment methods while making their way through the digital world that Meta bets will be the future. Read more

Uniswap acquires NFT marketplace aggregator Genie - Users know Uniswap as a decentralized way to swap a wide variety of tokens; this new acquisition will bring non-fungible tokens into the mix. Genie gives users access to the library of NFTs available across marketplaces and makes it so that they can see and trade NFTs across most of these platforms. Uniswap’s team say they will be using the product to build a Uniswap NFT vertical into their platform, which will launch this fall. Read more

FTX US is acquiring equities clearing startup Embed Financial - FTX US debuted its stock trading functionality, FTX Stocks, last month for select customers in private beta. The public release, limited to the US, is expected later this summer. The acquisition of Embed will help FTX US offer the stock trading functionality to other firms. Read more

Twitter partners with Shopify to bring merchants’ products to Twitter Shopping - The deal will see Twitter launching a sales channel app that will be made available to all of Shopify’s U.S. merchants through its app store. The app allows merchants to onboard themselves to Twitter’s Shopping Manager, the dashboard offered by the social media company where sellers can access product catalog tools and enable other shopping features for their profiles. Read more

EBay acquires NFT marketplace KnownOrigin for undisclosed amount - This acquisition is an important step in eBay's tech-led reimagination, ushering in a new era of digital collecting to the world's top destination for collectibles. KnownOrigin, which was founded in 2018 in Manchester, UK, enables artists and collectors to create, buy and resell NFTs via blockchain-support transactions. Read more

Ken Griffin’s Citadel is moving its headquarters to Miami from Chicago - Griffin said just last month that he was reaching a tipping point with Chicago, decrying the city’s crime rate and voicing frustrations with political leadership in Illinois. The hedge fund and market maker, both of which he founded, combined employ more than 1,000 people in the city. The firm said it expects a few hundred people to be based in Miami next year. Read more

Select Financings

Aidaly - Miami based provider of financial and coaching services for family caregivers raised $8.5m in Seed funding led by Seven Seven Six. Read more

Cleo - UK based super app focused on Gen Zers raised $80m in growth funding led by Sofina. Read more

Falcon X - California based cryptocurrency exchange focused on institutional investors raised $150m in Series D funding led by GIC and B Capital Group. Read more

Fido - Ghana based mobile credit startup raised $30m in Series A funding led by Fortissimo Capital. Read more

FinBox - India based credit and borrowing startup raised $15m in Series A funding led by A91 Partners. Read more

Finhay - Vietnam based digital investment platform raised $25m in Series B funding led by Openspace Ventures and VIG. Read more

Fung - Amsterdam based crypto payments infrastructure company raised $2.7m in pre-Seed funding led by Global Founders Capital. Read more

Huspy - Dubai based online mortgage platform raised $37m in Series A funding led by Sequoia Capital India. Read more

Ledger - New York based online marketplace that connects capital with insurance risk raised $75m in Series B funding led by WestCap. Read more

Magic Eden - San Francisco based NFT-marketplace raised $130m in Series B funding led by Electric Capital and Greylock. Read more

Openly - Boston based homeowners insurance startup raised $75m in Series C funding led by Advance Venture Partners. Read more

Opn Co - Japan based mobile payments startup raised $120m in growth funding led by JIC Venture Growth Investments and Mars Growth Capital Pte. Read more

PayGlocal - New Delhi based cross-border payments startup raised $12m in Series B funding led by Tiger Global and Sequoia Capital India. Read more

Playter - London based provider of BNPL solutions for SMEs raised $55m in equity and debt funding led by Adit Ventures and Fasanara Capital. Read more

Prime Trust - Las Vegas based provider of infrastructure for digital asset services providers raised $107m in Series B funding from investors including FIS, Fin Capital, Mercato Partners, Kraken Ventures. Read more

Stashfin - Singapore based neobank raised $70m in Series C funding led by Uncorrelated Ventures. Read more

SumUp - London based maker of point-of-sale payments solutions for small businesses raised €590m in equity and debt funding led by Bain Capital Tech Opportunities. Read more

Tapcheck - Los Angeles based earned wage access company raised $20m in Series A funding led by PeakSpan Capital. Read more

Vergo - New York based financial platform for the home building and renovation industry raised $4.1m in Seed funding led by CRV. Read more

Wahed - New York based Islamic fintech company raised $50m in Series B funding led by Wa’ed Ventures. Read more

zCloak Network - UK based provider of zero-knowledge proofs for public blockchains raised $5.8m in Seed funding led by Coinbase Ventures. Read more

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