Topline
In its third funding round in six months, FTX Trading, one of the world’s busiest cryptocurrency exchanges, has raised another $400 million in new investments, the firm announced Monday morning, boosting its valuation to a staggering $32 billion despite a January sell-off that’s wiped more than $500 billion from the value of the world’s cryptocurrencies.
Sam Bankman-Fried of FTX photographed in March 2021 by Virgile Simon Bertrand for Forbes.
Key Facts
Bahamas-based FTX’s latest funding round drew participation from existing investors including Singapore-based state-holding company Temasak, crypto venture-capital firm Paradigm, the Ontario Teachers’ Pension Plan Board and NEA.
The fresh cash comes just three days after the firm announced its independently operated U.S. sister exchange, FTX U.S., also raised $400 million from the same investors at a valuation of $8 billion.
In a statement, FTX CEO Sam Bankman-Fried called the financing round a “milestone achievement” that should help the exchange expand into new jurisdictions and build on its current offerings, which recently included the launch of cryptocurrency derivatives and a $2 billion venture-capital fund.
Bankman-Fried told CNBC on Monday that the firm has been discussing a potential initial public offering and will “try and be prepared, in case it’s something we do end up wanting to do.”
FTX has now raised about $1.8 billion since July, when the company was valued at $18 billion—15 times its valuation one year prior.
Key Background
Since its launch just two years ago, FTX has quickly grown into one of the world’s largest cryptocurrency exchanges, consistently ranking among the top 10 busiest by trading volume, according to CoinMarketCap. On Monday, FTX said it’s “grown significantly” since its last funding round in October, with its user base increasing by 60% and average trading volume averaging about $14 billion per day.
Surprising Fact
The crypto market is currently worth about $1.7 trillion, down more than 40% from an all-time high of $3.1 trillion in November, according to CoinGecko. In January alone, losses have totaled more than $500 billion after the Federal Reserve sparked a broad sell-off earlier this month by cautioning it may move more quickly than previously expected to reverse policy meant to bolster the economy during the pandemic. On Monday, Bankman-Fried sought to temper concerns about the recent sell-off, telling CNBC the interest-rate concerns have moved markets beyond just cryptocurrencies and saying he doesn’t believe we’re entering a “long-term crypto winter.”
Big Number
$17.1 billion. That’s how much Bankman-Fried was worth before the latest funding round, according to Forbes, making him the world’s richest 29-year-old.
Further Reading
Meet The World’s Richest 29-Year-Old: How Sam Bankman-Fried Made A Record Fortune In The Crypto Frenzy (Forbes)
Source: https://www.forbes.com/sites/jonathanponciano/2022/01/31/billionaire-bankman-frieds-crypto-exchange-ftx-lands-32-billion-valuation-and-400-million-in-new-funding/