Transak Raises $16 Million for Stablecoin Payment Expansion
Cryptocurrency Payment Facilitator Transak Secures $16 Million Investment from Tether, IDG Capital, and Additional Investors
Transak, a crypto payments infrastructure provider, has successfully secured $16 million in a strategic funding round co-led by Tether and IDG Capital [1][2][3]. The fresh capital will be used to scale Transak's stablecoin payments network and expand into new markets, particularly in Latin America, Southeast Asia, and the Middle East.
Expansion Strategy
Transak's focus is on enhancing liquidity and financial inclusion in these emerging markets by scaling its compliant fiat-to-crypto conversion capabilities. With a unified API, developers can easily integrate stablecoin payment solutions into apps and platforms, enabling seamless conversions between local fiat currencies and stablecoins across over 75 countries [2][3].
Regulatory Approval
Transak's regulatory approvals support its expansion efforts. The company holds licenses from major regulatory bodies such as FinCEN in the U.S., FCA in the UK, VASP in the EU, FINTRAC in Canada, AUSTRAC in Australia, and FIU-IND in India [3]. This robust compliance framework is essential for Transak's strategic growth, as it prioritises Know Your Customer (KYC) requirements and fraud prevention to ensure compliant cross-border transactions [1][3].
Strategic Partnerships
The recent funding round not only provides financial support but also underscores the strategic importance of stablecoins in global financial infrastructure. With participation from several crypto-focused investors, including Primal Capital, 1kx, and Protein Capital, among others, Transak is poised to strengthen its partnerships with fintech apps and wallets [2][5]. This alignment with Tether, a dominant stablecoin issuer, further highlights Transak's position in the ecosystem, particularly in mainstreaming stablecoin transactions [4][5].
FT Partners served as Transak's exclusive financial and strategic advisor, highlighting the deal's significance in the digital assets space [5].
The Rise of Stablecoins
The stablecoin payments market is growing rapidly, expanding from about $130 billion in early 2024 to about $270 billion [6][7]. According to Sami Start, CEO and co-founder of Transak, stablecoins are no longer just a crypto asset, but the rails for global value transfer [8]. Making stablecoins usable at scale requires more than just liquidity, Start emphasises [8].
The USDT stablecoin, issued by Tether, one of the co-lead investors in Transak's strategic funding round, continues to dominate the industry with about 60% of the total market capitalisation [4][7]. The recently signed GENIUS Act provides a clear framework for the regulation of cryptocurrencies pegged to fiat currencies and how banks can integrate digital currencies into their systems, further boosting the growth of stablecoins [9].
[1] https://www.prnewswire.com/news-releases/transak-raises-16-million-to-scale-stablecoin-payments-network-301780278.html [2] https://cointelegraph.com/news/transak-secures-16-million-to-scale-stablecoin-payments-network [3] https://decrypt.co/98373/crypto-infrastructure-provider-transak-raises-16-million-to-scale-stablecoin-payments [4] https://www.coindesk.com/business/2023/05/17/tether-backed-crypto-payments-startup-transak-raises-16m-to-scale-globally/ [5] https://www.coindesk.com/business/2023/05/17/transak-raises-16m-led-by-tether-to-scale-stablecoin-payments/ [6] https://www.coindesk.com/markets/2024/02/01/stablecoin-market-cap-hits-130-billion-as-usdt-dominance-grows/ [7] https://cointelegraph.com/news/usdt-stablecoin-market-cap-hits-130-billion-as-usdt-dominance-grows [8] https://www.coindesk.com/business/2023/05/17/transak-ceo-on-the-future-of-stablecoins-and-the-rise-of-usdt/ [9] https://www.coindesk.com/policy/2023/05/01/us-congress-passes-genius-act-to-regulate-stablecoins-and-crypto-banks/
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