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A Web3 payments infrastructure provider startup, Merge, announced today that it had collected $9.5 million in seed funding to build its payment and banking platform to “merge” traditional financial services into cryptocurrency.
Octopus Ventures led the round with other big players such as Ethereal Ventures, Hashed, Alameda Research, and Coinbase Ventures.
The Merge offers a way for firms to hold and transfer funds and easily convert them to and from digital assets, along with managing compliance.
The rise of Web3 has opened a lot of opportunities for the DeFi world, which is highly dependent on token economics. Transactions with tokens that can sustain the interests of regulators, such as Know Your Customer, taxation compliance, anti-money-laundering laws, and a lot more, are quite important for businesses and banks involved with Web3 and DeFi.
Zihao Xu, an investor at Octopus Ventures, believes that as the crypto economy becomes more and more mainstream, it is becoming clear that the current financial infrastructure can’t manage the rapid expansion of crypto-native businesses. Most of the providers do not have the expertise to estimate the risk.
Merge with its API makes all these payment challenges more accessible to banking partners. Web3 companies will get solutions to instantaneously open bank accounts, send payments and do the conversion of payments between money and crypto tokens. Licensing along with compliance monitoring are also included in the solutions.
Xu also stated that the vision of Merge is to create the necessary infrastructure required to enable crypto businesses to operate without having any fear of shutdown by regulators or third-party risk teams.
The company raised this funding amid a recent cryptocurrency market downturn as currencies such as bitcoin dropped below $30,000 in early May, the lowest since July 2021. Simultaneously, the stablecoin TerraUSD lost its parity with the U.S. dollar and its related cryptocurrency Luna lost 99% of its value in a massive market crash, creating even more market volatility.
The firm had the funding event amid the recent crypto market downturn as digital assets such as BTC experienced a steep dip, reaching even below $30,000 in early May, the lowest since July 2021.
Even despite such adverse conditions, venture capital has not stopped investing in Web3; take, for instance, last week’s funding of $4.5 billion raised by Andreessen Horowitz for its fourth crypto fund.
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.
