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- Bitpanda, a cryptocurrency trading platform, has raised $263 million in a new round of fundraising, valued at $4.1 billion
- That’s more than three times the $1.2 billion Bitpanda was valued at five months ago in its last private financing round
- Valar Ventures, the venture capital fund co-founded by US internet tycoon Peter Thiel, is backing Bitpanda
Bitpanda, a cryptocurrency trading platform based in Europe, has raised $263 million in a new round of funding, putting the company’s value at $4.1 billion. That’s more than three times the $1.2 billion Bitpanda was valued at five months ago in its last private financing round. The current round of funding takes the total amount raised to about $500 million. Valar Ventures, the venture capital firm co-founded by US internet tycoon Peter Thiel, spearheaded the investment. Valar has supported Bitpanda three times since its first significant fundraising round, which was revealed in September.
You don’t have to perform the entire roadshow if you have partners with whom you have a close relationship and who have large pockets, according to Demuth. He continued, Valar wanted to double down, and we wanted to stay with them. It was a simple procedure. Along with current investors LeadBlock Partners and Jump Capital, British billionaire hedge fund manager Alan Howard and REDO Ventures joined in Bitpanda’s latest round.
What exactly is Bitpanda?
Bitpanda is a Vienna-based brokerage service that allows consumers to purchase and trade cryptocurrencies and precious metals. It was founded in 2014. This year, the company began testing a program that allows customers to trade stocks 24 hours a day, seven days a week. Demuth believes you’ll have a really solid stock offering before the end of the year.
Due in part to the meme stock trading frenzy, Bitpanda is one of many online brokers in Europe drawing increasing attention from investors. Following the advice of a prominent Reddit site, retail traders poured into undervalued equities like GameStop and AMC. Trading volumes on digital platforms like Robinhood increased as a result.
Revolut, Trade Republic, and eToro are among Bitpanda’s competitors. Licensing its technology to banks and fintech firms is one way the company intends to set itself apart from competitors. It did not name any clients but said several large companies are currently using the technology and will be able to offer crypto and stock trading in a few months.
The disparity between what someone is prepared to pay for an item and the price at which that asset is sold is how Bitpanda generates money. Demuth claims that the company has been profitable for five years. In the fintech industry, profitability is a rarity, with many venture-backed startups losing a lot of money. Revolut, which had a market capitalization of $33 billion at the time, lost £167.8 million ($232.3 million) in 2020, up 57 percent from the previous year.
The Cryptocurrency craze
The increase in Bitpanda’s value comes at a time when the young cryptocurrency industry is gaining traction. This year has been a wild trip for digital currency investors, with the prices of bitcoin and other major cryptocurrencies reaching new highs in April and May before plummeting drastically in the weeks that followed.
The threat of regulation has been the biggest headwind for bitcoin recently. China has pushed down on speculative digital asset investing, and a provision in the recently passed US infrastructure bill is causing concern among crypto enthusiasts. According to Demuth, Europe has been slower to regulate the crypto business than its foreign counterparts. New EU legislation aiming at putting the sector under regulatory control, however, has encouraged him.
Nothing has been decided yet, according to Bitpanda’s CEO, but a merger with a special-purpose acquisition company, or SPAC, is ruled out. Blank-check businesses that list with the goal of bringing another firm public are known as SPACs. SPAC frenzy is a bad example of an IPO, according to Demuth. Circle, a digital currency firm based in the United States, announced last month that it sought to go public in a $4.5 billion SPAC offering.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.
