This Week in Fintech UK & Europe (19/07)

Hello TWIF UK & Europe friends,

Welcome to the inaugural issue of This Week in Fintech UK & Europe! I am excited to be working with Nik and Osborne and focusing on the vibrant fintech ecosystem in the UK & Europe. Due to Brexit implications I couldn’t call this newsletter just “Europe” (kidding … but not kidding!). Sign up to our London Fintech Happy Hour!

What a time to be launching, with Revolut’s recent raise and Wise recently going public. There have been 35+ $100m rounds across the region in 2021 and 8 of those greater than $500m. Europe is increasingly becoming a hotspot for fintech! Some more data below showing the funds flowing into UK and European fintech.

Don’t forget to subscribe to the other TWIF newsletter’s below!


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Editor’s Note: If you’re an early-stage startup founder raising equity or debt, I may be able to help - reach out to michael@thisweekinfintech.com.


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Funding 💸

There were 24 deals in the fintech space across the UK and Europe with a total investment of $2.15bn. Some highlights are below.

🇪🇺 Lunar raised a €210m Series D led by Heartland and included Kinnevik and Tencent. With the raise it’s rumoured to be a 🦄.

🇪🇺 HelloFlow raised $1.6m from PreSeed Ventures and Seedcamp

🇪🇺 Sorare raised a $532m round led by by SoftBank and included Atomico, Blisce and Eurazeo.

🇪🇺 Nethone raised a $6.7m Series A led by Atmos Ventures, ARIA Fund, Innovation Nest and Plug and Play.

🇪🇺 Liqid raised a $105m Series D led by LGT Group and included HQ Trust, Project A and Toscafund.

🇬🇧 Weavr raised a £7m seed round from Anthemis, QED and Seedcamp.

🇬🇧 LendInvest IPO’d this week on the LSE’s AIM market at a £250m valuation.

🇬🇧 Tide raised a $100m Series C at a $650m valuation led by Apax Partners and included Anthemis Augmentum, Jigsaw, Latitude, LocalGlobe and Speedinvest.

🇬🇧 Quantexa raised a $153m Series D from Warburg Pincus.

🇬🇧 Railsbank raised $70m led by Anthos Capital and included Outrun Ventures, Central Capital and Cohen and Company.

🇬🇧 Revolut is raising a £577m ($800m) round at a $33bn valuation led by Softbank and Tiger Global and advised by FT Partners. Over 5x it’s valuation from a year ago. (check out the long reads for a great piece on Revolut from Marc Rubinstein)

🇬🇧 Climate X raised a $1.5m in seed round led by Pale Blue Dot, A100x, Blue Wire Capital and Possibilian Ventures.

🇬🇧 Superfluid Finance raised $9m led by Multicoin Capital and included DeFi Alliance, Delphi Digital, Balaji Srinivasan, Ryan Selkis and Stani Kulechov.

🇬🇧 KodyPay raised $3.25m from Cognition Foundry and angel investors.

Challenger Banking 🚀

🇬🇧 The owner of Uswitch, Confused.com and Money.co.uk, RVU, is acquiring Mojo Mortgages as they expand their offerings to consumers and leveraging their customer relationships for cross-sell opportunities.

🇬🇧 Online mortgage broker Trussle Lab was acquired by Better HoldCo, a home ownership platform in the US.

🇬🇧 Starling Bank is marketing itself on 100 EV chargepoints from InstaVolt as it seeks to deepen its green credentials.

🇬🇧 Curve has partnered with Discover in Europe to let the card companies customers add their credit cards to the Curve app.

🇬🇧 Boubyan Bank has launched an Islamic bank in the UK that is Sharia-compliant.

Digital Assets ₿

🇪🇺 The EU is looking at setting up a dedicated agency to deal with crypto AML according to Reuters. A proposal wants exchanges to share details of who is making transactions as digital assets are not included in EU rules for financial services.

🇪🇺 The ECB has given the go-ahead to a two-year investigation into a digital euro.

🇪🇺 Regulators in Italy and Hong Kong piled the pressure on Binance in a week that saw its European payments processor, Clear Junction, to no longer process its transactions and Binance stopped its stock tokens offering which got it in trouble in Germany.

🇬🇧 UK’s Economic Crime Command, part of the Met Police, have seized £180m worth of cryptocurrency. This takes the top prize for the largest seizure of crypto, besting a £114m amount from just a few weeks ago.

  • 🙌🏻 TWIF Take -Crypto skeptics point to the lack of visibility or traceability of crypto and its use in criminal enterprise. However Chainalysis data puts illicit activity figure around 1%. Using a publicly available blockchain might not be the smartest money laundering scheme!

🇬🇧 FTX is joining Copper’s ClearLoop settlement network to gain access to new institutional funds

🌍 Square confirmed it’s creating a separate DeFi developer platform and bringing together Seller, Cash App and Tidal for permissionless financial services, with a focus on BTC.

Traditional Banking 🏦

🇪🇺 Bank of Ireland launched video tutorials to help customers to use its digital banking services.

🇬🇧 NatWest is embedding a carbon footprint tracker into its customer mobile banking app to allow them to track the climate impact of their spending.

Fintech Infrastructure 🚧

🇪🇺 Tink have appointed former AWS financial services chief Rowan Taylor as their chief revenue office.

🇪🇺 Nordigen has launched a clever tool to connect your bank account to Apple’s Siri to find out your balance

🇬🇧 The Bank of England is considering new policy measures to combat stability risks with banks moving infrastructure to global cloud providers (read Big Tech!)

Payments 💰

🇪🇺 Klarna has acquired social shopping startup Hero, brining the virtual shopping platform to enhance Klarna’s own shopping app.

🇬🇧 Money.co.uk reports that the average BNPL debt stands at nearly £250 per person and take 9 MONTHs to clear their BNPL debts.

🇬🇧 Mastercard is launching PayPort+, created by Form3, to allow better connectivity to the UK’s Faster Payments network.

  • 🙌🏻 TWIF Take -Interestingly Mastercard runs the infrastructure behind the Faster Payments network after their acquisition of Vocalink in 2017. Given Faster Payments underpins Payment Initiation Service, part of Open Banking, there is likely to be a huge surge in traffic across Faster Payments which benefits Mastercard nicely!

Regulatory Corner 🔎

🇬🇧 The FCA slapped Lloyds Bank with a £90m fine for misleading customers with insurance renewals by telling them they received a “competitive price”.

  • 🙌🏻 TWIF Take - In the insurance industry, it is well known that discounts are given to new customers and existing customers nearly always foot the bill through higher premiums in their second year and beyond. This is because most people are too busy or lazy to get a fresh quote and stick with the status quo. Insurance needs some attention from Look After My Bills. The notion of this type of service existing in the US is absurd for many reasons.

🇬🇧 The FCA has warned UK retail banks about weak AML controls as the regulator gets serious about improving its money laundering oversight. Areas of concern are “governance and oversight, risk assessments, due diligence, transaction monitoring and suspicious activity reporting”. What wasn’t an area of concern!


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Michael

This Week in Fintech UK & Europe (12/07)

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This week Akash Bajwa (fintech investor at Augmentum) and I hosted a London Fintech Happy Hour which was a great success, if I do say so myself. Check out the rare, dry London summer day event here!

Although numbers were restricted due to government guidelines, we hope to host larger events in the near future.

In collaboration with This Week in Fintech writer Nik Milanovic, we have created a sign up form to keep updated on future events in London, so please click below to sign up!

I'm interested in London Fintech Events!

If you are interested in sponsoring an event, please indicate your interest on the form above or reach out to me directly.


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Funding 💸

There were 28 deals in the fintech space across the US and Europe with a total investment of $750m. Some highlights are below.

🇪🇺 Pleo raised a $150m Series C at a $1.7bn valuation led by Bain Capital and included CreandumSeedcampThrive Capital and others. Denmark’s first unicorn!

🇪🇺 CoinShares acquired the ETF business of ElwoodTechnologies.

🇪🇺 Younited raised $170m from Goldman Sachs and Bridgepoint.

🇪🇺 Bunq raised a €193m Series A at a €1.6bn valuation led by Pollen Street Capital. The largest ever Series A by some reports!

🇪🇺 Juni raised a $21.5m Series A from CherryVenturesDSTGlobal and FelixCapital.

🇬🇧 Revolut is said to be raising $1bn from SoftBank with a $30bn-$40bn valuation. Their commitment to their mission was noted.

🇬🇧 Wise had its direct listing debut on Wednesday the first DL on the LSE. Trading started at £8 and at time of writing sits at £9.80, a valuation of ~£8.75bn (~$11bn).

🇬🇧 Moneyhub raised $18m led by Direct Line founder Peter Wood and included NBSVentures and NationwideVentures.

🇬🇧 Augmentum raised £55m in its latest funding round to invest in more fintechs.

🇺🇸 Unit21 raised a $34m Series B round led by Tiger Global.

🇺🇸 Zerion raised an $8.2m Series A led by MosaicVentures and included DigitalCurrencyGroupLightspeedVenturesBlockchainVentures and Wintermute.

🇺🇸 Circle, creator of USDC, is going public via a SPAC at a $4.5bn valuation.

🇺🇸 Willa raised an $18m Series A led by FinTech Collective and included EQTVentures and Entree Capital.

Challenger Banking 🚀

🇬🇧 Crown Agents Bank launched a pension solution with biometric authentication.

Digital Assets ₿

🇪🇺 The BIS found that crypto investing does not require new regulation as investors are motivated by speculation, the same as other asset classes. The paper claims “"we disprove the hypothesis that cryptocurrency investors are motivated by distrust in fiat currencies or regulated finance.". Pretty surprising but maybe this means crypto investing has crossed the chasm from early adopters to early majority?

🇬🇧 The UK’s Advertising Standards Authority is cracking down on misleading cryptocurrency advertisements. Luno’s London Underground ads were its first target for underplaying the risks. As crypto firms try to gain mainstream adoption, situations like these are likely to become more common, with certain disclaimers likely to be required.

🇺🇸 BlockFi is finally rolling out its credit card to US customers on its waiting list, which topped 400,000 people. Visa announced it has 50 partnerships with crypto platforms and exchanges allowing digital currency to be spent at 70m merchants via crypto-linked cards. Spending on the cards topped $1bn in H1 2021.

🇺🇸 Square’s hardware lead Jesse Dorogusker confirmed they are building a hardware wallet after rumours surfaced last month.

🌍 August 4th is the proposed date for the Ethereum “London” upgrade which includes EIP-1559 (EIP = Ethereum Improvement Proposal, a proposal to introduce changes to fees to make it easier to estimate the right fee for a transaction, to specify the maximum fee a user is willing to pay and cause part of transaction fees to be burnt.

🌍 With news that Circle was going public via a SPAC, CoinDeskreported on some interesting insights from its SEC filing. Circle makes more money from “transaction and treasury business” than from USDC. It also lost $156m on its buyout and spinout of Poloniex.

Traditional Banking 🏦

🇬🇧 Barclays have suspended payments to Binance from debit and credit cards and is the first bank to do so. Santander later followed suit as the FCA exerts its muscles in the crypto space, despite lacking direct authority over Binance. Binance already stopped Sepa payments in Europe and recruited eToro’s Jonathan Farnell as director of compliance.

Fintech Infrastructure 🚧

🇪🇺 Nordigenreleased a free tool to connect your bank account to Google Sheets.

Payments 💰

🇪🇺 Klarna is facing a data privacy investigation by Sweden’s regulator as to whether it violated bank secrecy laws following its May data security breach where customers had access to other customers accounts.

🇪🇺 P27 Nordic Payments has received ECB permission for its pan-Nordic payments platform.

🇺🇸 Amex will give US card members digital receipts when they shop at Amazon, giving them more details such as SKUs through a partnership with Verifi.


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This Week in Fintech UK & Europe (04/07)

Tweet of the week 🦉🏆


Happy 4th July to my American readers! I hope you are staying safe and enjoying yourselves.

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Funding 💸

There were 36 deals in the fintech space across the US and Europe with a total investment of $1bn. Some highlights are below.

🇪🇺 Imburse raised a €10m Series A from Addition, Gramercy Ventures, Accenture Ventures, Lakestar, SixThirty Ventures and PostFinance AG.

🇪🇺 Deutsche Borse Group acquired a majority stake in Crypto Finance AG.

🇪🇺 neon raised £3.9m in an hour via crowdfunding.

🇪🇺 Nuri raised €9m led by Earlybird Ventures and included Coparion and DIPCapital.

🇪🇺 Itsme raised €24.7m from Federal Holding and Investment Company.

🇬🇧 Codat raised a $40m Series B led by Tiger Global and included Index Ventures and PayPal Ventures.

🇬🇧 Rapyd is acquiring Icelandic payments company Valitor.

🇬🇧 SmartPension raised a $232m Series D from ChrysalisInvestments.

🇺🇸 Accept raised $90m in debt and equity from DN CapitalYC and SignalFire.

🇺🇸 Kikoff raised a $30m Series B from Coatue, Core Innovation Capital, Lightspeed Ventures, Portage Ventures and GGV Ventures.

🇺🇸 Orum raised a $56m Series B led by Accel and CanapiVentures which also included AcrewBainBoxGroupInspiredPrimary Venture Partners, and more.

🇺🇸 Tomo raised a $70m seed round led by Ribbit Capital and included NFX, SVB Capital, DST Global, and angel investors.

🇺🇸 Paceline raised a $30m Series A led by Acrew Capital and included Propel Venture Partners, Mubadala Capital and others.

🇺🇸 Harness Wealth raised a $15m Series A led by Jackson Square Ventures and included Bain Capital, Firstminute Capital and others

🇺🇸 Karat raised a $26m debt & equity Series A led by GGV Capital.

🇺🇸 WellsFargo acquire a stake in ThetaLake.

Challenger Banking 🚀

🇪🇺 MobilePayPivo and Vipps are banding together to create a single payments app with 11m customers across the Nordics.

🇪🇺 Pilant has released a corporate credit card to ensure carbon neutral travel.

🇬🇧 Revolut is giving users points for completing challenges which will then be used to enter weekly prize draws. The company plans on giving away £250,000 over four weeks.

🇬🇧 Tide is committing £100m in expanding internationally to India.

🇺🇸 Robinhood released its S-1 the same day that it was ordered to pay a $70m fine by FINRA for giving customers misleading information, having system outages and approving customers for options trading when it wasn’t appropriate. This comes after a $65m SEC fine in December. One of my favourite Twitter accounts, John Street Capital, has the breakdown above of the S-1.

  • 🙌🏻 FATP Take - Marc Rubinstein has a great insight into the debt Robinhood issued earlier this year at the height of the GameStop saga (scroll to hear the end). Gary Gensler was cited in the S-1 as a risk as to the conflict of interest with PFOF, something Europe has largely banned already.

Digital Assets ₿

🇪🇺 Germany’s new Fund Location Act allows institutional investment vehicles to invest up to 20% in crypto, which could trigger as much as $415bn in flows.

🇬🇧 Binance is claiming that the FCA’s recent action against it “has no direct impact on the services provided by Binance.com”. Additionally, the Cayman Islands Monetary Authority is looking if it falls within their regulatory purview after saying it was not authorised to do business there. Thailand has also piled on saying Binance isn’t authorised and Singapore is closely watching.

  • 🙌🏻 FATP Take - Digging deeper it seems Binance wasn’t regulated in the UK anyway, but had acquired a UK subsidiary and had applied to register with the FCA. So UK residents can still buy and sell crypto but the on-ramps are being impacted with UK customers reporting to have been cut off from the Faster Payments rails for withdrawals from Binance. It’s unlikely Visa and Mastercard will not help them out either.

🇬🇧 TP ICAP is launching a crypto trading platform for institutions through partnerships with Fidelity Digital Assets, Zodia Custody and Flow Traders.

🇬🇧 Former Governor of BoEMark Carney said stablecoins should have access to central bank’s balance sheet if they meet a number of requirements

  • 🙌🏻 FATP Take - Whilst comments like this are encouraging, would he have said this while he was still governor? My guess is no and it is more a personal view and not one that is likely to impact any action by BoE (sadly!). He wants strong capital and liquidity requirements for stablecoins.

🇺🇸 Jack Dorsey said Tidal is interested in exploring NFT opportunities in an unsurprising move after Square acquired a majority stake this year. Tidal could be another entry point for Square into the crypto world with its artists creating new ways to distribute and monetise their art forms.

🇺🇸 ARK Investment Management has applied to the SEC to create a bitcoin ETF through a partnership with 21Shares.

🇺🇸 Tom Brady and Gisele Bundchen are becoming brand ambassadors for FTX, with both getting equity in the company and signing bonuses paid in crypto.

  • 🙌🏻 FATP Take - Two of my favourite things coming together, Tom Brady and crypto. You just love to see it. This is only one piece of sports + crypto news recently. FTX has also sponsored Miami Heat’s stadium, MLB and an e-sports team. Crypto.com is also sponsoring Formula 1. Also with recent changes by NCAA allowing college athletes to monetise their name, image and likeness (NIL), college sports starts are being courted by all the fintechs so export more fintech/crypto + sports tie-ups. H/T to Joe Pompliano

🇺🇸 Coinbase is to start offering savings accounts with 4% interest on USDC deposits. Compound is launching savings accounts for institutions to access the Compound Protocol with Current announcing a partnership.

Traditional Banking 🏦

🇺🇸 Morgan Stanley bought nearly 30,000 shares of Grayscale Bitcoin Trust as its clients demand exposure to the asset class.

🇺🇸 JP Morgan acquired ESG investment platform OpenInvest.

Fintech Infrastructure 🚧

🇪🇺 Mambu signed League Data to modernise its core platform.

🇬🇧 Origin Markets released a flurry of announcements including the markets first standardised termsheet for IG bond issuance as well as instant-ISIN feature.

🇬🇧 TrueLayerreleased Verification API, to verify account ownership for onboarding with 20% improvement vs credit bureaus and increased speed. Congrats Olga Zapata & team!

Payments 💰

🇪🇺 Klarna is partnering with revenue-based financing provider Liberis, to offer its e-commerce merchants pre-approved, flexible loans.

  • 🙌🏻 FATP Take - Klarna is going head to head with Square Capital, Stripe Capital, Amazon, Shopify and more by lending to its merchant customers, attempting to further own or dominate the merchant relationship. Whilst Klarna is unlikely to see all of the trading of its merchants, POS providers like Square or payment processors like Stripe will, which might give them a loan issuing edge. Companies like Weav can help provide additional data to Klarna to better compete.

🇪🇺 OneFor has launched a cross-border money transfer app focused on migrant workers in Europe.

🇬🇧 Tomato Pay, formerly Fractal Labs, launched a QR payment app for SMBs.

🇺🇸 Venmo is adding a 1.9% + ¢0.10 transaction fee for payments for goods and services effective July 20th. This is on top of increased charges PayPal announced last week.

🇺🇸 Visa has hired or moved 5 people for its in-house crypto team and plans to expand further.

Regulatory Corner 🔎

🇬🇧 This week my inbox has been filled with emails from fintechs who are required by the FCA to remind their customers how their funds are protected under e-money accounts and how it differs from FCSC protected bank accounts. The FCA gave a six week deadline which expires this week.


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Michael

This Week in Fintech UK & Europe (28/06)

Tweet of the week 🦉🏆


Over the weekend the FCA, the UK’s top financial services regulator, banned crypto exchange Binance from undertaking any regulated activities in the UK, making it one of the most significant regulators to take action against the company. They have until Wednesday to confirm it has complied. Although the FCA doesn’t regulate all cryptoassets, they do regulate derivatives and assets they deem to be “securities”, meaning you need authorisation to advertise and sell them. Binance was not approved under the FCAs crypto registration scheme and its application was dropped recently.

This isn’t Binance’s first run-in with regulators as it got in hot water with BaFin recently due to its stock tokens product. Japan’s FCA equivalent also recently issued a warning to Binance.

A large number of tech companies have a “move fast a break things” mentality, which works in some industries but not in the heavily regulated world of financial services. Whilst crypto companies might believe that being decentralised and “outside the system” means they do not need to comply with traditional rules and regulations, they are increasingly finding that is not the case. On-ramps and off-ramps into fiat currencies are still needed which is where regulators have jurisdiction and can step in and take action, as well as in advertising crypto related products and services.

With the regulatory outlook for crypto still very nascent, some are using the opportunity to act like it’s the wild west while others are trying to work with regulators to help inform them and shape policy (probably to their own advantage). If I were running a crypto firm, I know which path I would take.


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Fundings & M&A 💸

There were 53 deals in the fintech space across the US and Europe with a total investment of $2.5bn. Some highlights are below.

🇪🇺 Mollie raised a €665m ($800m) Series C at a €5.4bn ($6.55bn) valuation led by The Blackstone Group and included EQT, General Atlantic and others.

🇪🇺 Hawk AI raised a $10m Series A led by BlackFin Capital.

🇬🇧 Wise has announced 7th July is its date for its direct listing on LSE.

🇬🇧 ClearScore raised £144m from Invus Opportunities.

🇺🇸 Crediverso raised a $3.1m seed round from Act One Ventures, Bessemer, Clocktower and Point72 Ventures.

🇺🇸 Securitize raised a $48m Series B co-led by Morgan Stanley and BlockchainCapital and included BorderlessCapitalGlobalBrainMouroCapital and more.

🇺🇸 Majority raised a $19m seed round led by Valar Ventures and included Avid Ventures and Heartcore Capital.

🇺🇸 Stash has acquired financial literacy startup PayGrade.

🇺🇸 Deserve raised a $50m Series D led by MastercardAllyVentures and MissionHoldings.

🇺🇸 Symphony has acquired voice trading software provider Cloud9 Technologies.

🇺🇸 Cross River Bank acquired PeerIQ.

🇺🇸 Chainalysis raised a $100m Series E at a $4.2bn valuation led by Coatue and included Accel, Addition, Altimeter, Benchmark, Blackstone and Dragoneer.

🇺🇸 SmartAsset raised a $110m Series D led by TTV Capital and included CitiVentures and others.

🇺🇸 RabbitHole raised $3.6m in a round led by Electric Capital.

🇺🇸 Yield Protocol raised a $10m Series A led by Paradigm and included Variant Fund, Framework Ventures and DeFi Alliance.

🇺🇸 Rarible raised a $14.2m Series A led by Coinfund and Venrock.

🇺🇸 Lower raised a $100m Series A led by Accel.

🇺🇸 Blockchain Capital has raised a $300m fund with participation from Visa and PayPal.

🇺🇸 Andreessen Horowitz announced a new $2.2bn Crypto Fund III and also that David Harber is joining the firm.

Challenger Banking 🚀

🇪🇺 Raisin has merged with Deposit Solutions to create a consumer savings behemoth.

🇬🇧 Revolut reported financials this week for 2020. Highlights were +34% revenue growth yoy to £222m, adjusted revenues +57% yoy to £261m, annual loss of £207m, gross profit £123m and 49% gross margin. Number of customers 14.5m (+45% yoy)and deposits of £4.6bn (+96% yoy).

🇬🇧 Credit Kudos released a credit decisioning product powered by open banking which saves lenders hours.

🇬🇧 Monzo got a telling off from the Competition and Markets Authority for not providing bank transaction histories to 143k former account holders in a timely fashion.

🇬🇧 Budgeting app Emma is to become a super-app, adding stock trading, crypto, P2P payments, savings accounts and credit scores to its portfolio of products.

🇺🇸 Robinhood and SoFi have moved to restrict customers that sell IPO shares they purchase through the respective platforms within 30 days from future IPOs.

Digital Assets ₿

🇬🇧 The FCA have banned Binance from the UK, ordering them to stop all regulated activities over concerns around AML, fraud and weak consumer protection.

🇺🇸 Goldman Sachs completed a repo trade using JPMorgan’s private blockchain network in what Goldman’s Matthew McDermott described as “a pivotal moment”.

🇺🇸 Citi officially launched “Digital Assets Group” under its wealth division.

🇺🇸 FTX is sponsoring MLB and becoming their “official cryptocurrency exchange brand”

🌍 As China clamps down on crypto miners, other locations should benefit from the activity. BIT Mining has delivered machines to Kazakhstan and another logistics firm is sending mining machines to Maryland. Twitter was abuzz with rumours of Chinese miners going to Austin. Anthony Pompliano wrote a good post on implications here.

🌍 The BIS anointed CBDCs as the winner against bitcoin, stablecoins and big tech.

🌍 Binance is launching an NFT marketplace with a headline auction called “Genesis” featuring Andy Warhol’s “Three Self-Portraits” and an NFT of Salvador Dali’s “Divine Comedy:rebeget”.

🌍 The two South African brothers who started Africrypt have disappeared as with $3.6bn in bitcoin.

Traditional Banking 🏦

🇪🇺 Fiserv and DeutscheBank have formed a JV for merchant acquiring in Germany.

🇺🇸 Fifth Third Bank is the latest to give customers access to their paychecks two days early.

🇺🇸 Morgan Stanley will require staff and visitors to be vaccinated to enter its New York offices.

Fintech Infrastructure 🚧

🇪🇺 Swift has signed up six global banks for its new ISO 20022 transaction platform which is going live in November.

🇪🇺 Visa is acquiring Plaid European rival Tink for €1.8bn in a boost for the open banking ecosystem in Europe. Simon Taylor has a good breakdown below

🇪🇺 Deutsche Bank has signed a collaboration with Oracle to transform its legacy database infrastructure.

🇺🇸 Wells Fargo has joined Akoya network, a data aggregator somewhat similar to Plaid but owned by banks.

🇺🇸 Circle is releasing a DeFi API, enabling companies to access lending markets starting with Compound.

Payments 💰

🇺🇸 PayPal is increasing costs for merchants on its platform to 3.49% + ¢0.49 per transaction for sales through its button or digital wallet and 2.59% + ¢0.49 for card payments, the latter undercutting Stripe and Shopify (2.9% + $0.30). In-person transactions are dropping to 1.9% + ¢0.10 for $10+ transactions and 2.4% + ¢0.5 for transactions under $10.

🇺🇸 Visa is partnering with Russian bank VTB to trial payments by looking at a camera.

Regulatory Corner 🔎

🇺🇸 The SEC pushed back a decision to approve an ETF from Valkyrie Digital Assets from June 26 to August 10.

🇺🇸 Lawmakers voted to repeal the “true lender” rule.


Longer reads 📜


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This Week in Fintech UK & Europe (21/06)

Tweet of the week 🦉🏆


It’s been an exciting week for the UK fintech scene with two big stories. Firstly, Wise announced it’s direct listing on the London Stock Exchange (LSE). This is a big boost for the UK fintech ecosystem as it will allow Wise employees and early investors to cash out and put that capital to work elsewhere in the ecosystem or start their own startup. It is also a boost for the LSE which has attracted a major company to list, something it has struggled with of late but maybe the tide is starting to turn (Deliveroo and PensionBee listing recently).

Marc Rubinstein has a great write up on Wise and the company’s history from a P2P FX platform to its expansion into banking products with its borderless accounts (sign up here) and its B2B products and platform solutions like its integration with Thought Machine.

Wise has 6m customers, £421m in revenues and has been profitable for 5 years. If Wise was in the US, I would imagine with those stats it’s value would likely be much higher than it will when it lists in London.

The second story was that JP Morgan is buying UK roboadvisor NutmegNutmeg has struggled with a high CAC and low user growth although it does have £3.5bn under management and 140k customers in the UK. This makes average balances around £25,000 although likely to have long left tail. Fees range from 0.45% to 0.75% making annual revenues between £16m - £26m. Although the amount JP Morgan paid was not announced, estimates from crowdfunding investors put the amount at around £700m (or £5,000 per customer and 44x-27x revenues).

JP Morgan is set to launch its challenger bank Chase in the UK this year and its acquisition of Nutmeg will likely boost its capabilities beyond traditional banking to include wealth management. The contrasting choice of JP Morgan to buy (Nutmeg) vs build (Chase) is an interesting one.


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Funding 💸

There were 51 deals in the fintech space across the US and Europe with a total investment of $2.61bn. Some highlights are below.

🇪🇺 Upflow raised a $15m Series A led by 9Yards Capital and included N26 co-founder Max Tayenthal.

🇪🇺 Change has raised €3.7m from 50 private investors in a crowdfund round valuing it at €175m.

🇪🇺 Pennylane raised €15m from Sequoia.

🇪🇺 Finleap Connect raised €22m from SoftBank, SBI Investment and IlavskaVuillermoz Capital.

🇬🇧 DNA Payments raised £100m from Alchemy Partners.

🇬🇧 Generation Home raised $30m in equity and $422m in debt from investors including Mithrill Capital, La Famiglia, Firstminute CapitalJamJar and others.

🇬🇧 Nutmeg is being acquired by JP Morgan.

🇬🇧 Trilo raised a £1m pre-seed round.

🇬🇧 ThinCats raised £160m strategic investment from Wafra Capital.

🇬🇧 Volt.io raised a $23.5m Series A led by EQT Ventures and included Augmentum Fintech and Fuel Ventures.

🇬🇧 10x Future technologies confirmed their $187m Series C investment co-led by BlackRock and CPP Investments with existing investors also supporting the round.

🇬🇧 Publicly listed investor Augmentum Fintech is raising £40m of capital and broadening its scope to include seed-stage fintechs.

🇺🇸 B9 raised a $1.7m pre-seed round

🇺🇸 dYdX raised a $65m Series C led by Paradigm and included Wintermute and Polychain Capital as well as others.

🇺🇸 Novo raised a $40.7m Series A led by Valar Ventures and included BoxGroup, Rainfall Ventures, Read Sea Ventures and Crosslink Capital.

🇺🇸 Goldfinch raised $11m from Andreessen Horowitz.

🇺🇸 Unit raised a $51m Series B led by Accel and included Better Tomorrow VenturesFlourish Ventures and Aleph.

🇺🇸 Spash Financial has raised a $44.3m Series B from Citi Ventures, CMFG Ventures, DST Global, Firebolt Ventures and Northwestern Mutual.

🇺🇸 TRM Labs raised $14m in a Series A led by Bessemer and included Blockchain Capital, Initialized Capital, PayPal Ventures and Salesforce Ventures.

🇺🇸 Guideline raised $200m from Propel, Greyhound, Generation IM, General Atlantic and Felicis Ventures.

🇺🇸 PayCargo raised a $125m Series B from Insight Partners.

🇺🇸 BitWise raised $40m in a round led by Electric Capital and Elad Gil.

🇺🇸 Finley raised a ¢2.9m seed round led by Bain Capital Ventures and included YC, Twenty Two Ventures, Nine Four Ventures and Haystack.

🇺🇸 The WSJ reports that existing Stripe shareholders sold $1b in shares to SequoiaShopify (a partner of Stripe), Silver Lake and Capital Group as investors jumped at the opportunity to get their hands on shares of the hottest fintech’s around.

Challenger Banking 🚀

🇪🇺 Raisin has launched in the US with its first US partner bank, MapleMark Bank.

🇬🇧 New Zealand BNPL firm Laybuy is bringing its digital BNPL card to the UK.

🇬🇧 Shrap, a change card which aims to replace coins by giving users their change on a Shrap card, is conducting two pilots in a bid to keep access to cash for communities.

🇺🇸 Verizon, the US telecoms giant, is launching a payment card and app for kids.

🇺🇸 Novus has partnered with Visa and Railsbank to offer users rewards for sustainable purchasing.

Digital Assets ₿

🇪🇺 Swiss bank Sygnum is launching custody and trading services for DeFi tokens

🇪🇺 BBVA has opened bitcoin trading to its Swiss private banking clients after six months of testing.

🇺🇸 Uniswap is the first decentralised exchange (DEX) to pass $300bn in trading volume, up from $1bn a year ago.

🇺🇸 Greyscale is eyeing 13 more investment products, including ones tied to Solana and Polygon.

🌍 Hedge funds may invest $312bn into crypto assets by 2026 according to a survey, representing a 10% allocation.

🌍 The World Bank denied El Salvador’s request to help it implement bitcoin as legal tender given its “environmental and transparency shortcomings.” Hopefully some other agencies or crypto experts will help.

🌍 Easy come easy go for Iron Finance and its TITAN token, which had peak TVL at $3bn and the price to TITAN rose to $64 but crashed to almost 0 in less than 24hrs in a bank run. The Defiant has the scoop on what happened and Frances Coppola had a great write up. There were also issues with algorithmic stablecoin Malt resulted in some LPs earning 500,000% APR.

🌍 Sichuan, a Chinese crypto mining center, has told the state power grid to cut its hydroelectricity supply to 26 mining farms. This sent bitcoins hash rate plummeting.

🌍 Stablecoin Tether saw more volume that PayPal and Zelle in Q1 2021.

Traditional Banking 🏦

🇪🇺 BaaS platform SolarisBank has migrated its customer base from a third party core to its own inhouse alternative.

🇺🇸 American Express is launching checking accounts and lines of credit for SMEs as it looks to build upon its acquisition of Kabbage.

🇺🇸 CapitalOne added early direct deposits, copying challenger banks like Chime.

  • 🙌🏻 FATP Take - Whilst fintechs like Chime are solving customers problems one at a time, building out its functionality, banks will keep copying it, eroding their value propositions. Whilst copying features in the social media space has proven to be a good strategy for Facebook, will the case be the same for incumbent banks?

Fintech Infrastructure 🚧

🇪🇺 Societe Generale is partnering with Temenos to revitalise its account management and payment systems in Europe and Asia.

🇬🇧 The UK and the Nordics came out ahead in Mastercard’s Open banking Readiness Index, with digital infrastructure, high number of bank APIs, progressive regulators and consumer readiness the highest across Europe.

🇺🇸 Google lost another exec in a short space of time from its Cloud financial services business as Global Head Anil Saboo is leaving after three years to become VP at Bakkt. Derek White left last week to become CEO of Galileo.

🇺🇸 Stripeannounced its first partnership for Stripe Treasury, farming financial management company Ambrook.

🇺🇸 Modern Treasury launched Ledgers, a solution to track products that store and move value.

Payments 💰

🇬🇧 Checkout.com acquired Estonian software development firm Icefire.

🇺🇸 Visa and Mastercard both make separate partnerships in the biometric payments space. Visa with Abu Dhabi Islamic Bank and Mastercard with UK’s FinGoVisa also kicked off its Tap to Phone POS offering this past week in the US.

🇺🇸 Former PayPal exec’s Jim Nguyen and Nas Kavian have launched Six Clovers, a decentralised global payments network aiming to replace Swift and build on the Algorand blockchain.


Longer reads 📜


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