Blockchain and cryptocurrency startup Paxos raises $65 million
31/05/2018 14:00
By Anna Irrera
NEW YORK, May 31 (Reuters) - Blockchain and cryptocurrency
startup Paxos has raised $65 million from investors including
venture capital firms RRE Ventures and Liberty City Ventures,
the New York-based company said on Thursday.
Paxos will use the cash injection to expand its operations,
which include providing blockchain-based services to financial
institutions, as well as operating cryptocurrency exchange and
custodian itBit, it said.
Private equity executive Jay Jordan, also participated in
the investment, Paxos said.
"We will use the capital to help grow the business which is
broadly our settlement business on the Paxos side and the crypto
asset exchange and custodian on the itBit side," Chief Executive
Charles Cascarilla said.
Founded in 2012 as bitcoin exchange itBit, the company later
rebranded to Paxos and pivoted into a business focused on
providing services using blockchain, the technology underpinning
virtual coins.
Most recently it has sought to revive the cryptocurrency
side of its business, in a bid to take advantage of an explosion
in crypto-trading sparked by a rally in the price of tokens.
"We have been pouring a lot of resources into it for the
past nine months," Cascarilla said, adding that the company was
planning to launch more products.
Paxos holds a trust company charter in the state of New
York, giving it many of the same privileges as a bank including
the ability to take custody of mainstream financial assets.
That same ability can give it a competitive advantage,
Cascarilla said.
In June 2016 Paxos announced a joint venture with
Belgium-based settlement provider Euroclear to develop a
blockchain-based system to settle gold.
The bullion joint venture was dissolved in 2017, but Paxos
has continued to develop and test the system with financial
institutions, Cascarilla said. He declined to provide the name
of the firms.
The joint venture with Euroclear had been tested with at
least 16 London gold market participants, including Citigroup
Inc C.N , Societe Generale SOGN.PA , Scotiabank and INTL
FCStone Inc INTL.O .
(Reporting by Anna Irrera
Editing by Tom Brown)
((anna.irrera@tr.com; +1 646-223-4005 ; @annairrera;))