VC Backed Startup, Deel, Partners With Coinbase to Roll Out Cryptocurrency Payroll Service

Deel, a San Francisco based crypto startup backed by Andreesen Horowitz, is launching a crypto payroll tool that would allow international workers to get paid in different cryptocurrencies.

Deel raised about $44 million in funding ($14M Series A and $30M Series B) during the ongoing pandemic and specialized in offering payroll and compliance services to remote workers internationally. The new payroll tool would allow the Deel customers to accept their payroll in top cryptocurrency like Bitcoin, Ether, and XRP with instant withdrawals.

Deel has partnered with Coinbase to offer its payroll tool, and users would be required to have or create a Coinbase account to use the new services.

Dan Westgarth, Deel’s chief operating officer, explained that the motive behind creating such a payroll tool was to help international workers to save hefty remittance costs charged by traditional banks and money transfer services. He explained,

“A question on a lot of people’s tongues is: will it be widely adopted? Will the companies paying these people to be willing to opt into it?

Well, we built it in a way that the company doesn’t choose. The remote worker chooses.”

“So I can be working for an old, boring institution, run by a load of old guys who don’t understand crypto and oppose it.

They could pay me in U.S. dollars, but given I’m a Deel user and given I get paid through Deel; I could elect to have my paycheck delivered in XRP — instantly.”

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Author: James W

Lightning Labs Allows Users to Earn Interest on BTC by Providing Capital to LN

Lightning Labs has launched a marketplace for liquidity on the network.

The startup focused on developing the Layer 2 payment channel for Bitcoin, Lighting network, has opened the door to “LiFi” – Lightning financial products.

This non-custodial, peer-to-peer marketplace “transforms” your Lightning liquidity into a tradable asset on the Lightning Pool, allowing the user to buy or sell access to this liquidity.

In simple words, “People can earn interest on their BTC by helping to provide capital to the Lightning Network, while keeping control of their funds.”

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Unlike decentralized finance (DeFi), where a third party is the one with the custody of your funds, as in the case of Wrapped Bitcoin (WBTC), it is BitGo; Lightning Pool allows sellers to earn yields on their BTC without trusting a third party with their sats.

“The yield is earned from buyers on the Pool willing to pay a premium for access to new capital on Lightning without counterparty risk,” reads the announcement.

The lack of liquidity on the liquidity Network has been an obstacle, “one of the most widely felt pain points,” to its adoption, which the marketplace is addressing through Pool, which will allow everyone to participate.

“We developed Pool out of a need in the market that emerged from Lightning users who were looking for new sources of liquidity to enable them to more efficiently receive funds and transact on Lightning.”

In the beginning, the payment channels will have a maximum leasing time limit of two weeks or 2016 blocks, which will be diversified to six months. The liquidity provider will receive fees on their Pool account up-front.

“Pool features a p2p auction mechanism, batched execution, and a new concept called shadowchain using bitcoin script.”

Currently, it is in closed alpha with exchanges and wallets to make sure when it launches, it has enough liquidity. And because this is not DeFi, the maximum account size, for now, is 10 BTC as it is early and needs to be stress tested.

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Author: AnTy

DeFi Trading Startup, Dharma, Adds Ability to Buy Tokens Directly from Bank on UniSwap

Dharma, a DeFi-focused startup, has been given the green light to enable Automated Clearing House (ACH) trading for DeFi tokens within 13 states in the U.S. The startup, backed by Coinbase, has been making major strides in the burgeoning DeFi space, with the latest integration of the Uniswap DEX a few months back. The startup is optimistic about becoming the ‘Robinhood’ of crypto as per earlier comments from its CEO, Nadav Hollander.

“Our goal in building ‘the Robinhood of crypto’ is to bridge the final gap between these blossoming markets and the millions of individuals who will want to tap into them as they gain popularity and mindshare.”

The ACH service by Dharma will enable its U.S clients to make direct DeFi token purchases from their bank accounts. According to the milestone update, users will incur a 1.5% fee while the weekly purchase limits have been capped at $25,000. U.S states where this service is available to include Wyoming, Wisconsin, New Hampshire, Washington, Virginia, Texas, Pennsylvania, Montana, Michigan, Massachusetts, Georgia, California, and Arizona.

With the ACH service in place, Dharma’s prospects of pivoting as the ‘Robinhood’ of crypto have increased; Nadav noted that DeFi trading with their application would undoubtedly make the participation process simpler,

“Investing DeFi has, up until now, been a bifurcated and highly technical process. Now, it’s as easy as downloading an app and connecting your bank account.”

Notably, Dharma had earlier incentivized user participation by offering to cover the gas fees coupled with a no-fee, no-gas promotion in August. Its newly integrated ACH services are being supported by APIs from a Fintech giant dubbed ‘Plaid.’ Nadav told CoinDesk in an email that they are leveraging services from an active crypto-focused bank. However, he did not disclose the name.

“We are processing ACH transfers through a direct partnership with a well-known bank active in the crypto space.”

Dharma’s journey in the DeFi space has evolved quite fast; the startup secured $7 million in a funding round back in February 2019. At the time, Dharma’s focus was an Ethereum based lending service; it later moved to stablecoin-oriented savings and finally the Uniswap integration.

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Author: Edwin Munyui

In Q3 Ripple Paid Out Over $9M in XRP to Its Strategic Partner, MoneyGram; A 38% Drop Over Q2

  • The blockchain-focused startup, Ripple Inc. continues to funnel millions of dollars’ worth of XRP to global remittance firm, MoneyGram.
  • The San Francisco-based firm channeled $9.3 million in XRP tokens to MoneyGram over the third quarter of 2020, representing a $5 million decrease from the previous quarter.

The latest MoneyGram financial results released on Thursday show Ripple Inc. made a payment of $9.3 million in market development fees to the remittance service provider. The company received a net benefit of $8.9 million after a partial offset of $0.4 million in “transaction and trading expenses”.

The payment is made every quarter since the partnership between Ripple Inc. and MoneyGram in 2019. According to a MoneyGram spokesperson, the firm gets paid the fee for facilitating and processing transactions on Ripple’s On-Demand Liquidity (ODL) product, which uses XRP for settlement.

However, this represents a drop from the $15.1 million paid out in Q2 2020, signaling a drop in transactional volume on Ripple’s ODL platform.

The recent payment brings the total amount paid to MoneyGram to $52 million adding to the $16.1 million in XRP paid in Q1 2020, and a total of $11.3 million paid out in the last half of 2019. According to an insider in MoneyGram, the company does not hold any XRP but rather sells it as soon as they receive it.

In mid-June 2019, Ripple announced a strategic partnership with MoneyGram that would see the latter benefit from Ripple’s cross border trading services and foreign exchange settlement using the XRP token. Furthermore, Ripple invested $50 million into MoneyGram in exchange for equity to kick start the partnership.

The partnership between the two payment firms is expected to last till 2023.

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Author: Lujan Odera

SEC Proposes $5 Million Settlement in Kik’s $100 Million ICO for KIN

Kik Interactive, the embattled Canadian messaging startup, seems to have finally reached a settlement deal with the SEC regarding its illegal ICO back in 2017. Since the summer of 2019, the two parties in court have gone back and forth, with the latest ruling by a New York judge, favoring the SEC.

With barely three weeks since the ruling, the SEC has now proposed that Kik should settle with a fine of $5 million with the market watchdog. Kik’s ICO had raised a total of $100 million, intended for a crypto network dubbed ‘KIN.’ This was, however, cut short by the SEC, which sought to pursue Kik on account of issuing an illegal security.

According to the SEC’s court document, the two parties have agreed on a proposed judgment and are now seeking the court’s approval. Other than the $5 million in penalties, Kik will be required to give a 45-day notice if they want to launch another Kin token sale. The document states,

“The proposed Final Judgment, if approved by the Court, would permanently enjoin Kik from committing future violations of Section 5, according to Section 20(b) of the Securities Act of 1933, 15 U.S.C. § 77t(b); impose a conduct-based injunction, as outlined in the proposed Final Judgment, under Section 21(d)(5) of the Securities Exchange Act of 1934, 15 U.S.C. § 78u(d)(5); and require Kik to pay a penalty of $5 million, under Section 20(d) of the Securities Act, 15 U.S.C. § 77t(d). The proposed Final Judgment would conclude this action.”

Unlike Telegram, which had a similar encounter with the SEC, Kik has not been obliged to return its investors’ funds. This means that the project’s tokenization dreams could be realized despite the SEC’s 16-month long legal battle. Notably, Kik has previously argued that its Kin token was sold based on its underlying utility instead of a speculative nature suggested by the SEC.

If the court approved the proposed judgment, Kik would only settle for $5 million; this amount is equivalent to what they collected during their fundraising initiative dubbed ‘Defend Crypto’ Campaign. Other ‘illegal’ ICOs like EOS and Telegram have had it a bit rougher, with each settling at $24 million and $18 million, respectively.

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Author: Edwin Munyui

Crypto Business Banking Startup, Multis, Raises $2.2M Backed by Coinbase & Y Combinator

Multis, a French-based business banking startup, has raised $2.2 million in its seed fund round that attracted industry giants, including Coinbase Ventures, Digital Currency Group, Y Combinator, and White Star Capital. The firm’s operational niche is building business bank accounts that allow clients to send, receive, and manage cryptocurrencies.

According to Multis Co-founder and CEO, Thibaut Sahaghian, crypto management is pretty complicated for prospectus companies that may wish to leverage digital payments,

“It’s very complicated to manage crypto as a company. As soon as you want to hold crypto or start paying employees and contractors, it’s a giant mess.”

However, Multis, which runs software as a service (SaaS) product suited for corporate teams, solves this challenge through its crypto-oriented business bank account. The Multis bank accounts leverage a multi-sig wallet based on Ethereum blockchain; this design allows the addition of other team members and the setting of fundamental guidelines.

Notably, Multis does not control clients’ keys, which means that the firm has no authority to block transactions or review the same. Sahaghian noted that their approach as a non-custodial crypto service provider eliminates a considerable amount of regulatory risk,

“From a regulatory point of view, it’s been very useful because we don’t hold assets and we can’t review and block transactions.”

The Multis business bank accounts also support stablecoins such as DAI and USDC; this means that clients can eliminate crypto volatility by holding their assets in the form of ERC-20 stablecoins. In addition to this, Multis provides an avenue to yield DeFi returns through Compound protocol.

Currently, a good part of Multis clients fall in the blockchain and crypto space, but the firm is looking to expand this market share with the integration of EUR and USD accounts via IBANs and cards. The firm has since expressed optimism in providing centralized management for crypto transactions; TechCrunch highlighted,

“Multis could act as a bridge between fiat currencies and cryptocurrencies. Companies with offices in multiple countries could use it to save money on intercompany fees.”

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Author: Edwin Munyui

Dutch-based Security Token Exchange, Dusk Network Raises $1M From Bitfinex Parent

Dusk Network, a Dutch-based startup set to launch a regulated security token exchange, has received $1 million in funding from Bitfinex’s parent, iFinex. The exchange, whose operational niche is tokenized assets including exchange-traded funds (ETFs), commodities, and equities are set for debut in 2021, according to sources who informed TheBlock.

The Dusk announcement on September 1 noted that this milestone would see the firm expand its horizon in the crypto space, especially within the burgeoning European market. Consequently, its prospectus security token exchange by Dusk will operate under the region’s Markets in Financial Instruments Directive (MiFID II). This EU regulatory framework was designed to protect the interest of investors as well as increase transparency.

Notably, the recent $1 million funding towards Dusk’s initiative is not the first significant financing achievement the Amsterdam-domiciled firm has achieved. Back in 2018, Dusk Network raised roughly $8.85 million in private sales. Nonetheless, the company’s business lead, Jelle Pol, has clarified that Dusk Network’s security token exchange will be run as a separate unit.

This development comes as excitement around regulated security tokens builds up for institutional investors. With the Netherlands positioning itself as a ‘crypto valley’, the country’s financial market regulations on tokenized assets are among the most advanced in the world. In fact, the country’s central bank has since offered to lead the European Union in CBDC development and integration.

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Author: Edwin Munyui

Visa’s Fast Track Program On Boards New Bitcoin Lightning Payment Startup, LastBit

The Visa fast track program has onboarded a new Bitcoin Lightning crypto payment startup, LastBit, which recently launched its beta app. This addition comes barely a month since Strike also joined the Visa initiative to scale crypto adoption through Lightning BTC payment solutions.

Lastbit will enable merchants to accept BTC payments regardless of their preference since the underlying tech converts such transactions to fiat upon settlement. Currently, this BTC lightning-based innovation only allows merchants to receive their payments in U.S dollars. However, they are set to release an app that is Euro compatible in a few weeks, according to the company’s founder, Prashanth Balasubramanian.

LastBit’s BTC Lightning for Micropayments

Despite the rise of Bitcoin and other cryptocurrencies, mainstream adoption is still one of the most significant uncertain factors. Well, BTC lightning solutions, which came up as a result of network congestion, seem to be finding a niche in micropayment fiat-crypto on-ramps, given the convenience in rates and transaction time.

LastBit’s lighting payment, for instance, allows users to load BTC on their applications, after which they can access a digital debit card. With this card, they can then initiate BTC payments, which are received by vendors in dollars and soon Euros.  Balasubramanian has since noted that their goal is to facilitate the mass adoption of Bitcoin as a standard means of payment,

“We simply want to see the masses using bitcoin on a day-to-day basis. To do this, we have engineered arguably the most seamless interoperability between bitcoin and fiat, on top of the Lightning Network, that caters to the needs of both new and experienced users alike,”

Prospect Markets!

As the world continues to move towards digital ecosystems, crypto startups like Stripe and LastBit are looking to capitalize on the growing opportunities in various markets. On this front, LastBit is set to expand into Europe following approval from the EU. Balasubramanian confirmed this prospectus move with Coindesk, highlighting that;

“With a solid product, partnerships and notable investors […] behind us, we’re going to roll out our Bitcoin, Lightning, and EUR interoperable payments layer in the EU to prove that this works and that a small company without millions can pull off a complex payments product to push for Bitcoin adoption,”

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Author: Edwin Munyui

ConsenSys Acquires JPMorgan’s Ethereum-based Quorum for an Undisclosed Amount

Blockchain software startup ConsenSys has acquired Quorum, JPMorgan Chase’s blockchain unit, for an undisclosed amount.

The investment banking giant has also made a strategic investment in ConsenSys, the company established by the co-founder of Ethereum, Joseph Lubin, in 2014 to help build applications running on top of the second-largest blockchain network. Lubin said,

“Even before the very first block on Ethereum was mined, and ConsenSys was formed, we’ve collaborated with JPMorgan on Ethereum proofs of concept and production systems.”

There is a “commercial arrangement” for ConsenSys to support JPMorgan in their projects.

Quorum blockchain, which will remain open-source, was built internally at JPMorgan using the Ethereum network. The blockchain is used by the bank to run the Interbank Network — a payments network that already involves over 300 banks, which will continue to operate using the platform.

The Quorum team will remain at JPMorgan, and the transition will happen over the next year before it starts working on other blockchain projects.

“We believe a platform like Quorum could thrive better in the hands of a software and services-oriented organization,” said Umar Farooq, global head of blockchain at JPMorgan.

“Acquiring a blockchain sort of misses the point,” said Samantha Radocchia, author of the book “Bitcoin Pizza” about this development.

Earlier this year, ConsenSys underwent a restructuring to separate its software business form venture activities. As we reported recently, ConsenSys also owned the source code of popular Ethereum wallet MetaMask.

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Author: AnTy

Crypto Lending Startup, BlockFi, Secures $50 Million In Series C Funding

The popular crypto lending startup, BlockFi, announced that it has completed another successful funding round where major industry investors were involved. The firm announced that it raised $50 million in its latest Series C funding round.

In a statement to the public, Anthony Pompliano stated that the funding round was led by his crypto asset management company Morgan Creek Digital among other reputable investors. Morgan Creek Digital co-founder, known as Pomp, also revealed that he would become part of BlockFi’s board of directors. Pomp’s appointment to the board follows Morgan Creek’s participation in all of the three of BlockFi’s funding series in the last one year.

Pomp praised BlockFi for its phenomenal growth and its contribution to the crypto industry. He said:

“BlockFi’s platform offers investors unparalleled capabilities in the digital asset ecosystem. We’re excited to back this world-class team as they continue to add new products and expand into incremental areas that are disrupting traditional finance.”

The funding round also attracted other big shots in the crypto industry, including Valar Ventures, Winklevoss Capital, CMT Digital, Castle Island Ventures, Purple Arch Ventures, SCB 10X, Avon Ventures, Kenetic Capital, Michael Antonov, and HashKey. NBA’s Matthew Dellavedova also participated in the funding round.

The new funding round comes at a time when the firm has witnessed a 10-fold revenue growth in the last 12 months. The crypto lender now boasts of $100 million in terms of revenues in the previous year. The firm also boasts of $1.5 billion in terms of managed assets since it was started.

According to BlockFi’s CEO Zac Prince, the newly raised capital is set to be utilized in helping the firm to grow geographically and increase the number of staff to deal with the increasing number of clients. Prince also explained that some of the money would be used in the development of a Bitcoin rewards credit card that is set to be released in the near future. The firm aims at releasing the credit card in the first quarter of next year, Prince revealed.

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Author: Joseph Kibe