In the latest development in the cryptocurrency world, Revout – a digital bank startup from the United Kingdom has raised $500 million in a fresh funding round and tripled its valuation to hit the $5.5 billion mark. As per the report of the Financial Times on February 25, this makes the crypto-supporting app one of Europe’s most valuable fintech firms.
Ever since late 2017, Revolut’s app has enabled its users to complete transactions in cryptocurrencies which include Bitcoin (BTC), Litecoin (LTC), Ether (ETH) as well as Ripple’s native token, XRP.
In December 2018, the firm received a banking license in Lithuania, which paved the way for this crypto-friendly banking app to make a transition away from prepaid cards towards offering a fuller suite of banking services.
Valuation equals erstwhile record for European fintech
The Silicon Valley venture capital group TCV led this funding round, which also invests in major tech players such as Facebook, Airbnb, Tripadvisor, LinkedIn, and Spotify.
The $5.5 billion valuations of Revolut by TVC equals the previous record set by a private European fintech firm - Sweden’s Klarna back in 2019. In 2018, the firm had been valued at $1.7 billion, in a funding round led by DST Global which earlier backed Facebook and Spotify.
Revolut — which has a massive user base of over 10 million, saw customer growth and rose by over 150% last year. Alongside its cryptocurrency and stock trading features, the firm is also looking to expand into lending services and is actively pursuing a UK banking license.
Until now, the UK is proving to be a highly lucrative market for Revolut but disrupter banks, too. Sometimes, these banks are dubbed “neobanks” — with their user base soaring from 7.7 million to 19.6 million last year, according to a report released by Accenture yesterday.
The first half of 2020 could also witness Revolut launching in the United States, should the firm manage to clear the regulatory hurdles. Reportedly, it has also been eyeing an expansion to the Latin American and Asian markets.
Neobanks and cryptocurrency banks gain traction
As recently reported, Mark Hipperson, who is the co-founder of fellow UK-based neobank Starling, is planning to launch a new banking venture, Ziglu, in Q1 2020. The new crypto bank will offer balances in multiple currencies — i.e. both fiat and cryptocurrency, which can be held together in one account and can be spent globally using a Mastercard debit card.
Hybrids incorporating the features of legacy banking services and cryptocurrency transactions continue to develop. Coinbase, a digital currency exchange, this week announced its principal membership of Visa, whereas crypto-dedicated banks such as Switzerland’s SEBA and Syngum continue to diversify their services.
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