Circle Internet Financial Ltd., maker of an app that lets people send money to each other via bitcoin’s blockchain—the Internet network underlying the digital currency—says it is heading to China.
The Boston-based startup, backed by Goldman Sachs Group Inc., Breyer Capital, Accel, and other venture firms, said in a statement on its website that it has raised $60 million of new capital from Chinese firms and financial institutions as it aims to let users in China begin sending free peer-to-peer payments overseas with renminbi.
Circle has already secured licenses in the U.S. and U.K. to swap dollars, pounds, euros and bitcoins via the blockchain.
Working with its new Chinese partners and the People’s Bank of China, it will now seek to do the same in the world’s second-largest economy and the biggest market for person-to-person digital payments. Regulatory approval in the country is expected to take months if it goes smoothly.
Circle, founded in 2013, currently transmits a fraction of the payments its rivals do. It is aim is to grow by working closely with regulators to enable payments to flow instantly across borders via the Internet-based blockchain for free—versus the slower or more expensive government rails, bank wires, or credit-card networks—and to integrate payments with chatting and other social applications.
The fundraising is being led by IDG Capital Partners, the Chinese venture-capital firm, and includes backing from Internet company Baidu Inc.; banks China International Capital Corp. and Everbright Securities Co.; auto-parts company Wanxiang Group; and online lender CreditEase.
In total, Circle has now raised some $140 million as it seeks to carve out share in a very crowded global market for person-to-person mobile payments.
There are already hugely popular payment apps in China operated by Ant Financial Services Group and Tencent Holdings Ltd., as well as U.S. services such as PayPal Holdings Inc.’s Venmo, and J.P. Morgan Chase & Co.’s QuickPay. Other startups, such as Transferwise Inc., are also seeking to make it cheaper and easier to send money across borders.
Source: Wall Street Journal