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Mercado Bitcoin, Brazil’s first crypto exchange, raises $200M from SoftBank

Mercado Bitcoin, a Latin American digital resources exchange, has raised $200 million in Series B funding from the SoftBank Latin America Fund.

The round values 2TM Group, Mercado Bitcoin’s non-operating parent company, at $2.1 billion, ranking it among the top 10 unicorns in Latin America

The funding comes just months without São Paulo-based Mercado Bitcoin’s Series A round (of an undisclosed amount) in January of 2021, which was co-led by G2D/GP Investments and Parallax Ventures, with participation from HS Investimentos , Gear Ventures, Évora and Genial. JPMorgan and DealMake.

Image Credits: Mercado Bitcoin

It moreover comes without an impressive first half of the year for the company. Between January and May 2021, Mercado Bitcoin says that well-nigh 700,000 new customers signed up to use its services, bringing its consumer wiring to 2.8 million. That’s increasingly than increasingly than 70% of the unshortened individual investor wiring on Brazil’s stock exchange, equal to the company. Also, during the first five months of the year, Mercado Bitcoin saw its trade volume surge to $5 billion, which is increasingly than the total volume it saw in its first seven years combined. It’s moreover 11 times the volume experienced during the same period in 2020.

Founded by brothers Gustavo and Mauricio Chamati in 2013, Mercado Bitcoin was the first crypto mart in Brazil. The visitor has been profitable since 2018, and until January 2021 had been bootstrapped from inception, reinvesting its mazuma generation into growth and portfolio expansion, equal to CEO and 2TM Group Executive Chairman Roberto Dagnoni.

“This makes us a somewhat unique specimen in the ecosystem and among our fintech peers in unstipulated – few companies have managed to reconcile over 100% year-over-year growth with a positive marrow line,” he told TechCrunch, describing Mercado Bitcoin as “the crown jewel” of 2TM Group.

The holding visitor owns a number of other entities such as Meubank, a multi-asset wallet and worth service currently waiting for a Brazilian Central Bank license; Bitrust, a qualified digital custodian and Clearbook, an probity crowdfunding platform, among others.

In 2019, 2TM Group became the first visitor in the world to tokenize public debt assets. Then in 2020, the visitor issued Futecoin, the world’s first digital windfall based on FIFA’s solidarity mechanism.  

“We have moreover tokenized or distributed private debt, stat credits and a variety of utility and DeFi tokens,” Dagnoni said. This year, Bitrust will proffer the first Latin America based Digital Custody service. 

“There is a lot increasingly to come, and the series B round will be a relevant factor in supporting continuous innovation,” Dagnoni added. While he declined to reveal the value of the Mercado Bitcoin’s Series A round, he said it unliable the visitor to invest virtually $40 million in expanding its operations in Brazil this year.

Today, Mercado Bitcoin has well-nigh 500 employees. That compared to virtually 200 a year ago. By year’s end, Dagnoni projects it will have a headcount of well-nigh 700.

Besides hiring, he said that Mercado Bitcoin/2TM will moreover use the new wanted toward expanding its service offerings and investing in infrastructure “to meet the soaring demand for crypto in the region.” In particular, the visitor will be focusing on acquiring new customers and product listings as well as expanding to other countries such as Mexico, Argentina, Colombia and Chile “through a combination of M&A and greenfield operations,” equal to Dagnoni.

So what exactly has driven so much growth for Mercado Bitcoin? Dagnoni believes there are a number of factors overdue it.

“Millions of people virtually the world are realizing that digital resources and cryptocurrencies are both innovative in their technological foundations and are efficient in storing of value, and Brazil is no exception to this trend,” he said. 

Also, the country has seen some of the lowest interest rates on record, which he said has fueled the minutiae of the volitional resources industry. 

“Crypto is taking wholesomeness of this trend, which is moreover on walkout for other windfall classes, such as VC and private equity,” Dagnoni said.

And finally, he believes that the fact that Brazil’s financial services industry is so well-matured has spelled opportunity for fintechs in unstipulated in the country.

For its part, SoftBank Latin America Fund described Mercado Bitcoin as a “regional leader in the crypto space” that is “tapping into a huge local and regional addressable market.”

It added: “At SoftBank we squint to invest in entrepreneurs who are challenging the status quo through tech-focused or tech-enabled merchantry models that are disrupting an industry – Mercado Bitcoin is doing just that.

SoftBank has been zippy in Latin America as of late. In early June, the Japanese investment conglomerate said it would invest “up to $150 million” in Grupo Bursátil Mexicano (GBM), a 35-year-old investment platform in the Mexican stock market.

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