The US subsidiary of FTX cryptocurrency exchange, FTX.US, has reached a valuation of $8 billion. It notched this new milestone after raising $400 million from a series A funding round according to a Reuters report.
FTX Exchange reaches an $8 billion valuation after attracting major investors
According to a Reuters report, FTX.US has just raised $400 million from its first-ever funding round. This is coming after the exchange, along with Binance, recorded significant loses. The Series A funding round attracted multinational investment managers including Japan’s SoftBank Group, Singapore’s Temasek Holdings, and crypto investment firm Paradigm and Multicoin Capital.
FTX.US plans to use the newly acquired funds to establish itself as a leader among US-based crypto exchanges. To do this, the exchange plans to use the funds to expand its user base and staff strength, as well as launch new business lines according to the Reuters report.
What this raise means to us is that we are officially establishing ourselves on the stage of the largest competitors of cryptocurrency exchanges in the U.S., and signaling to the world that we are going to continue to expand very rapidly, FTX.US President Brett Harrison said.
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FTX.US which was established in 2020 had a daily transaction volume of about $360 million in Q3 of 2021 and recently launched NFT trading. Last year, the exchange acquired LedgerX, a CFTC regulated derivatives trading platform, in a bid to push its crypto derivatives offering to the US market.
FTXUS’s parent company, FTX, is one of the fastest-growing cryptocurrency exchanges in the world and has rapidly gotten a valuation of $25 billion. In December, reports were that FTX founder, Sam Bankman-Fried, planned to carry out a $1.5 billion funding round that would raise the valuation of the exchange to around $32 billion.
Massive growth is heightening competition in the crypto market
The crypto market has been attracting a lot of investment since last year. Several crypto firms including DapperLabs, Sky Mavis, and Moon Pay reached unicorn status even as the market soared to over having a $3 trillion capitalization. Bloomberg also noted that venture capital funds poured a record-breaking $30 billion into crypto investments in 2021. Remarkably, much of that fundraising, about $7.2 billion, came from US venture capital.
This has warranted a high level of competition among crypto exchanges in the US as the leading exchanges tussle for market share. Coinbase recently revealed that it was acquiring regulated derivatives exchange FairX to enable it to start offering crypto futures and options trading services in the US.
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