Crypto-Friendly Banking App Now One of Europe’s Most Valuable Fintechs

Since late 2017, Revolut’s app has enabled its users to complete transactions in cryptocurrencies that include Bitcoin, Litecoin (LTC), Ether (ETH) and XRP. 

United Kingdom-based digital bank Revolut has raised $500 million in a fresh funding round and tripled its valuation to hit $5.5 billion. This, as the Financial Times reported on Feb. 25, makes the crypto-supporting app one of Europe’s most valuable fintech firms.

In Dec. 2018, the firm received a banking license in Lithuania, paving the way for a transition away from prepaid cards toward offering a fuller suite of banking services.

Valuation equals erstwhile record for European fintech

The new funding round was led by Silicon Valley venture capital group TCV, which invests in major tech players such as Facebook, Airbnb, Tripadvisor, LinkedIn and Spotify.

TCV’s $5.5 billion valuation of Revolut equals the previous record set by a private European fintech, Sweden’s Klarna, in 2019.

In 2018, the firm had been valued at $1.7 billion, in a funding round led by early Facebook and Spotify backer DST Global.

Revolut — which has a user base of over 10 million — saw customer growth rising by over 150% last year. Alongside its cryptocurrency and stock trading features, the firm is looking to expand into lending services and is pursuing a U.K. banking license.

The U.K. is proving to be a highly lucrative market for disrupter banks — sometimes dubbed “neobanks” — with users soaring from 7.7 million to 19.6 million last year, according to a report released yesterday by Accenture.

The first half of 2020 could also herald Revolut’s launch in the United States, should the firm manage to clear the regulatory hurdles. It has also been eyeing expansion to Latin American and Asian markets.

Neobanks and cryptocurrency banks gain traction

As recently reported, Mark Hipperson, the co-founder of fellow U.K.-based neobank Starling, is planning to launch a new banking venture, Ziglu, in Q1 2020. The bank will offer balances in multiple currencies — both fiat and cryptocurrency — held together in one account, which can be spent globally using a Mastercard debit card.

Hybrids combining the features of legacy banking services and cryptocurrency transactions continue to develop. Coinbase this week announced its principle membership of Visa and crypto-dedicated banks such as Switzerland’s SEBA and Syngum continue to diversify their services.

Token Trading Platform From Russia’s Richest Man Enters Testing Phase

Russia’s richest man, Vladimir Potanin, is making steady headway with his blockchain-based trading platform for industrial assets and commodities.

The billionaire’s venture, dubbed Atomyze, launched today, Feb. 25, in test mode. Potanin’s mining and smelting firm Nornickel will be the first to issue tokens on the platform, which is designed to speed up transactions, enable surplus supply trading and cut back on the red tape needed for interactions between customers and businesses.

Atomyze is based on IBM’s Hyperledger Fabric blockchain technology, and
Nornickel’s partners Trafigura, Traxys, and Umicore have been invited to participate in the platform’s testing phase.

In an interview with Bloomberg, Potanin indicated that other services and commodities from Potanin’s businesses could be tokenized using the platform in the future, such as Nordstar airline tickets and ski passes at his resort in Sochi.

Tokenizing metals at world’s largest producer of palladium and nickel

Potanin has estimated that crypto tokens will eventually account for one-fifth of all sales on Nornickel — the world’s largest producer of palladium and refined nickel.

Initially, Nornickel plans to test tokens backed by palladium, cobalt and copper reserves, with the total anticipated issuance in the first year expected to reach up to 10% of overall sales volume of production.

Via the platform, metal-backed tokens can be traded for physical supplies, and firms with a surplus from their contractual volumes from Nornickel can trade with other parties.

To broaden the platform to include Potanin’s other businesses — such as the Nordstar airline or the Rosa Khutor resort in Sochi — Atomyze will need to seek further approval from the central bank.

Having recently secured the green light from Russia’s central bank to extend platform’s user base to include consumers, Potanin noted that the central bank had given him a very wide mandate, observing that:

“To some extent Russia appears ahead of many other jurisdictions in terms of digitalization.”

Beyond Russia, Atomyze will be available for businesses — but not consumers — in the United States and Switzerland, once regulatory approval has been secured.

Potanin’s venture meanwhile awaits the finalization of amendments to Russia’s forthcoming law on digital financial assets. As reported, these were submitted by the central bank after the successful conclusion of a four-month pilot of Atomyze in its regulatory sandbox.

Potanin therefore expects commercial operations of the platform to launch by the year’s end.

Blockchain solutions for traditional extractive industries

As reported, IBM and Nornickel joined forces last year to launch an educational program for specialists to develop digital technologies for the mining and metals industry.

Beyond Nornickel, Austrian steel trading company Alukoenigstahl has also revealed that it is working on a blockchain-based steel trading data system dubbed “Steel but Smart.”

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