FalconX crypto platform valued at $8 billion in new funding round

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By Caroline Mandl

NEW YORK (Reuters) – Digital asset platform FalconX was valued at $8 billion in a new funding round led by Singapore’s sovereign wealth fund GIC and B Capital, more than doubling its valuation in 10 months, its chief executive and founder Raghu Yarlagadda told Reuters, despite the recent fall in crypto markets.

This funding round totaled $150 million from new and existing investors, bringing new capital to the company even with an unfavorable market environment for cryptocurrencies. Not all of the money will go into the company’s coffers as some investors also sold an undisclosed stake in FalconX.

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The deal comes as FalconX plans to increase its workforce by 30% in the coming months, adding 55 new employees to the company. It also intends to use proceeds from acquisitions, technology and data analytics, expanding its services to trade execution, credit and prime brokerage institutions, Yarlagadda said.

“Over the next 12 to 18 months, we expect a very volatile market. And given that volatility, we see very strong opportunities for acquisitions,” Yarlagadda said.

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Besides GIC, new investors in the company include private equity firm Thoma Bravo and Adams Street Capital, while existing investors Tiger Global Management, Thoma Bravo and Wellington Management poured more money into FalconX.

Yarlagadda said the fundraising environment has become tougher for crypto companies.

“The big theme we’ve been discussing with these investors is the flight to value because investors are no longer looking at growth and costs,” he said. “Now investors are very specific about sustainable growth. They look at profitability.”

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Cryptocurrency valuations have plunged in recent weeks as investors dump risky assets amid a rising interest rate environment, raising fears of a recession. Over the weekend, the world’s largest cryptocurrency, bitcoin, fell below the key $20,000 level for the first time since December 2020.

Yarlagadda said the platform is already profitable and has reached a record number of customers, without disclosing further details.

(Reporting by Carolina Mandl; Editing by Lincoln Feast.)

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