Valar leads Series A for Hong Kong fintech start-up XanPool
Valar Ventures has led a $27 million Series A round for XanPool, a Hong Kong-based financial technology start-up that facilitates payments outside of legacy financial infrastructure.
Additional contributions came from CMT Digital, Gumi Cryptos, Antler, and angel investor Taavet Hinrikus, founder and chairman of Wise, formerly known as Transferwise. The proceeds will go towards consolidating XanPool’s presence in Asia Pacific – where its software is already used in more than 13 jurisdictions – and expanding its service offerings.
The company was founded in 2019 by Jeffrey Liu and Tema Ibragimov (pictured) as a peer-to-peer software solution enabling cryptocurrency to fiat currency transactions to be settled within seconds without taking custody risk. It relies on a crypto-to-crypto network of individuals and businesses, whose idle capital is used to settle cross-currency and cryptocurrency transactions.
This reduces the counterparty risk and costs of transactions, while allowing the liquidity providers to earn fees of up to 2% a month. XanPool has more than 500,000 users and 400 business partners and claims to be Asia’s largest decentralized liquidity pool with $200 million available. It serves traditional companies that are overlooked by standard payment processors as well as cryptocurrency users.
“In the coming years, XanPool’s network will look more similar to that of the SWIFT Network. Just like SWIFT, XanPool does not hold liquidity itself, instead, it relies on the liquidity of all the participants using the network,” said Liu, who also serves as CEO, in a statement.
“Just like SWIFT, XanPool earns fees based on the communication that its software facilitates. But unlike SWIFT, XanPool is compatible with modern payment solutions like cryptocurrency, fast payments, and e-wallets. You can expect more innovation from XanPool in this direction.”
James Fitzgerald, a founding partner of Valar, added: “It’s impressive seeing how XanPool has capitalized on the adoption of cryptocurrency to build a decentralized payment network powered by this new asset class. This space is evolving quickly; the incumbents aren’t going to know what hit them.”
Valar, which was established by PayPal co-founder Peter Thiel, is an active investor in Asia fintech, and in cryptocurrency-related start-ups specifically. In recent months, it has led a $60 million round for BukuWarung, a digital infrastructure provider for small businesses in Indonesia, and a $25 million Series A for Vauld, an Indian cryptocurrency borrowing and lending platform.
The venture capital firm also took the lead in a $75 million Series B for ShopUp, a Bangladesh-based start-up with a suite of supply chain, logistics, and finance offerings for small-scale retailers.
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