Crypto exchange FTX’s blockbuster fundraising reveals a sharp contradiction within the cryptocurrency world. Even as bitcoin prices fall below $30,000 and speculation abounds that we’re in a crypto bubble, venture capital firms are convinced that this industry has real promise. The funding round is the largest in history for a crypto company.
FTX raised $900 million in Series B funding from more than 60 investors that included Paradigm, Sequoia Capital, Coinbase Ventures, Daniel Loeb’s Third Point, Circle and Lightspeed Venture Partners. It now has a valuation of $18 billion, slightly under the $20 billion estimate rumored in the weeks leading up to Tuesday’s announcement.
Still, the investment is remarkable for a 2-year-old enterprise that was valued at just $1.2 billion last year. Clearly, FTX’s backers believe there will be a strong need for crypto exchanges in the future as more people get involved in crypto.