Digital asset custodian Fireblocks has scored a bumper $8bn valuation following its latest funding round.
Since launching in 2018, Fireblocks has amassed $45bn of customer assets under custody, capturing the attention of VC funds from the traditional world of finance. The $550m Series E funding round was jointly led by D1 Capital Partners and Spark Ventures with participation from CapitalG, a venture capital firm owned by Google’s parent company Alphabet.
“We’ve become almost a gateway drug into into crypto,” Fireblocks chief executive Michael Shaulov told City A.M., revealing he is still receiving messages from companies trying to scrape into the company’s oversubscribed round.
Crypto custody became big business in 2021 as institutional investors flooded into the space and began seeking out secure crypto trading infrastructure. Even the UK’s former Chancellor Philip Hammond got in on the action, announcing he would be joining crypto custodian Copper as an advisor.
Fireblocks describes itself as a “an asset transfer network that is somewhat similar to Swift,” which lets institutions transfer digital assets between one another without the risk of phishing or spoofing attacks. Unlike its rivals Fireblocks uses a technology which allows “direct custody.”
“We as Fireblocks operate as a technology partner to clients, and we don’t have any access to their funds,” explained Shaulov. “They don’t have any counterparty risk to us.”
The set up is clearly a hit among investors with a staggering 15 per cent of global institutional crypto trade volume now processed by the start-up’s infrastructure.
“Over the last 18 months we’ve seen exponential growth,” Shaulov commented. “We had about 100 clients at the start of 2021 and we finished the year with 800. We’ve transferred over $2tn worth of assets.”
The firm has big ambitions for 2022, with plans to increase its DeFi offering, expand into NFTs, tokenize securities and real world assets as well as pursuing expansion into markets such as South America, South East Asia and Africa where Fireblocks has previously been inactive. When questioned about whether expansion plans will be subdued by the bear market Shaulov said the company is undeterred.
“Crashing is in the eye of the beholder,” he said. “When we started the company in 2018 the price was just $3,500. So when people complain that it’s $3,7000 that is really not a bad outcome. The Crypto market has always been volatile.”