New York-based Crypto Startup Raises $14 Million For A Payments Network Targeting Greater Merchant Adoption
You may soon find it so easy to spend your bitcoin at your local deli or favorite coffee shop, thanks to a crypto startup that just raised over $14 million to develop a platform that brings together crypto holders and local merchants.
On Thursday, April 11, New York-based crypto startup Flexa announced it had raised $14.1 million in a funding round from investors such as Pantera Capital, 1Kx, Access Ventures, and Nima Capital.
Although the company hasn’t released details on any particular merchant partnerships, it did confirm that the payment network could be ready for launch sometime in May this year.
According to Flexa CEO Tyler Spalding, the new platform’s functionality will be like that offered by Apple Pay. It means that crypto users will only need to have a QR code scanned at a retail point of sale for them to buy goods or pay for services.
He explained that merchants would not require having any specific hardware or undertaking a software upgrade. Speaking to The Block, Spalding added that their system will allow for backward compatibility via a code merchant can “scan into their systems.”
The Flexa system then enables the point of sale to accept the payments by reconciling it with an ACH payment.
Mainstream adoption of crypto payments has slowed down, especially since the beginning of last year when the latest crypto market downturn began.
Even the entry of Wall Street giants like Fidelity Investments, NYSE owner Intercontinental Exchange (ICE) and Goldman Sachs has not been enough to convince most mainstream merchants to accept crypto.
A recent research report by JPMorgan revealed that most of those global firms and merchants that began accepting cryptocurrency payments much earlier, like Microsoft, Overstock, and Newegg, still take these payments.
However, some, like Expedia and OKCupid, have been forced to discontinue the service citing various barriers- mainly crypto volatility and transaction complexities.
Flexa wants to change things, especially regarding the fear companies that are looking to accept cryptocurrency payments have about volatility.
Spalding notes that the firm will work with its exchange partners to “liquidate the crypto in real-time,” with the same amounts debited from its accounts in real time.
The payment network Flexa envisions will also benefit retailers as it cuts costs and provides blockchain-based safeguards against fraudulence.
The firm’s future plans include serving as a hub for mainstream adoption of crypto that brings together projects, merchants and crypto spenders.
Disclaimer: This is not investment advice. Cryptocurrencies are highly volatile assets and are very risky investments. Do your research and consult an investment professional before investing. Never invest more than you can afford to lose. Never borrow money to invest in cryptocurrencies.