Crypto Payments Startup BoomFi Raises $3.8 Million
A FinTech that looks to help merchants accept and convert cryptocurrencies has closed a new round of funding.
About the round:
This week, BoomFi announced that it had raised $3.8 million. The seed round was led by White Star Capital along with participation from Passion Capital, Blockchain Founders Fund, Kraken Ventures, GSR, Aquanow, and Mantle Network among others. With the new funds, the company says it will work to transform crypto and digital payments for web3 and traditional web 2 merchants.
BoomFi is a payment processing platform for digital currencies. This includes the ability for merchants to accept crypto and have those payments converted to fiat for settlement. According to the firm’s site, merchants can process their first $10,000 in payments for free, while a 1% fee will apply after that.
In the background
This investment comes amid a challenging time for crypto start-ups. Earlier this month, the Securities and Exchange Commission (SEC) sued major exchanges Binance and Coinbase, accusing them of operating as unregistered securities exchanges. In response, Robinhood also announced that it’d be delisting three specific coins: Cardano, Polygon, and Solana. On BoomFi’s site, they note that Polygon and Solana are both among the assets their service supports. However, it’s unclear whether the SEC’s action would impact this at all.
What they’re saying:
Pitching the concept of BoomFi, co-founder Jack Tang said in a press release, “The way we pay for things and send/receive money in the future will involve crypto rails and bridging traditional and decentralized systems. But today it’s riddled with a mirage of complexities and challenges. We’re streamlining payments across various blockchains and traditional payment rails into one seamless, borderless and familiar payment experience.” Tang also commented on the seed round, saying, “This funding will push us full-throttle into a world where crypto payments is the norm, not the exception.”
Elsewhere, White Star Capital general partner Sep Alavi said of the firm’s investment, “BoomFi is set to spearhead the crypto payment revolution. Their unwavering commitment to streamlining crypto transactions in the payment sector aligns flawlessly with the prevailing trends. We are witnessing a significant shift towards the utility phase of blockchain technology and crypto, where goods and services seamlessly integrate, and BoomFi’s dedication perfectly captures this evolving landscape.”
As mentioned, the timing of BoomFi’s seed round is interesting given the recent news regarding the SEC. While these specific woes may not impact BoomFi directly, the uncertainty surrounding crypto in general may lead to some trepidation among merchants that the firm would want to partner with. Nevertheless, while there are certainly a number of questions that will need to be answered in the coming months, it’s clear that investors and consumers haven’t lost interest in cryptocurrencies entirely. Thus, we’ll need to wait and see what BoomFi is able to accomplish with this new capital.