The year 2021 opened with rioters storming the U.S. Congress, hit a crescendo with “Squid Game”, and climaxed with inflationary supply-chain snafus, while of course Omicron is providing a fitting denouement.
But hey, forget the dystopian vibe – or maybe embrace it. This is the year crypto became Too Big to Fail.
2021 has been an amazing year for fintech in general: the sector had raised $93 billion in new funding by the end of September (of which $3.5 billion was in Southeast Asia), putting it on track for a monster $120 billion year.
During the second quarter, fintech accounted for 20 percent of total venture funding. And fintech unicorns now account for about one in five throughout tech.
Asia played a big part in the highs and lows. DigFin has compiled its list of 15 winners and 3 losers. Let’s dive in.
Winners (in alphabetical order)
Australia’s poster child for the global buy-now, pay-later phenomenon sold itself to Jack Dorsey’s Square (now named Block) for $29 billion in Square stock. Afterpay was founded in 2014 and by 2018 had already expanded to the U.S., giving it an attractive customer base for Square, whose own payments business was stronger on the merchant side.
BNPL took off over the past two years as more consumers preferred to shop online instead of risking Covid-19 – and to stop using credit cards with their high interest rates. Afterpay and BNPL has come under fire by Australian regulators for charging late fees, but most of the firm’s money comes from merchant fees.
This Singapore-headquartered startup, founded in 2016 as Monaco, exploded into the public consciousness this year with a splashy 20-year deal to get naming rights to a huge sports arena in Los Angeles. This was followed up by a big media campaign featuring Matt Damon.
- Read more:
- Afterpay versus Kredivo: a tale of two BNPL fintechs
- Kris Marszalek, Crypto.com goes mainstream, VOX Ep 7
- Monaco looks past Singapore for global crypto-card reach
Kris Marszalek, the low-key co-founder who lives in Hong Kong, told DigFin earlier this year he has amassed 10 million customers for his retail crypto wallet, and intends to scale that to 100 million, fast. He won’t disclose numbers but he has built a billion-dollar (plus) business at lightning speed.
The Hong Kong-based crypto exchange co-founded by Sam Bankman-Fried in 2019 raised an astonishing $900 million in July, valuing the crypto exchange at $25 billion, followed by a Series B round of $420 billion in October. Sequoia, BlackRock, and Tiger Global are among the investors falling over themselves to get a piece of FTX.
FTX has already started putting the proceeds to work, co-investing in a $100 million project to integrate the Solana blockchain into Web3 gaming platforms. Bankman-Fried has been a public supporter of Solana since the layer-1 technology launched in 2020, citing it as a more scalable alternative to Ethereum. Beyond the geeky stuff, FTX is also upping its retail profile: in April it won the naming rights to the arena hosting the Miami Heat basketball team.
But this is also the year FTX shifted its domicile from Hong Kong to the Bahamas – an ominous sign for Hong Kong.