In a breaking announcement on Tuesday, London-based bank app Revolut raised $500 million in a Series D round of funding. Now they want to use that money to bring access to crypto into the U.S. market.
The $5.5 billion valuation that Revolut received in their latest capital raise is pretty crazy, but this is an app that is already dominating the European market and giving a good name to fintech companies. In a statement by the CEO, Nik Storonsky, he said:
“Going forward, our focus is on rolling out banking operations in Europe, increasing the number of people who use Revolut as their daily account, and striving towards profitability.”
Crypto Adoption Aided by Popular Applications
Bitcoin was added to the Revolut platform in July 2017, with the other additions following in the months after. In Europe, Revolut already has a decent crypto offering, with BTC, ETH, LTC, BCH, and XRP. It helps that they also have a strong fiat-to-crypto rail with 29 fiat currencies available in their application. This seems like the first really strong fiat offering that also has a good crypto one. And what makes Revolut truly special is the ease of use.
In the past, many pundits have discussed barriers to widespread adoption, and what always comes up is the intuitiveness of the applications. Having a hardware wallet or knowing your private key is not something casual investors have had to worry about in decades, so when a company like Revolut comes along and makes it easy to buy Bitcoin or buy altcoins, that is a winning move.
Strong Customer Acquisition
By bringing these services to all 50 states, Revolut has a good chance of acquiring a lot of customers. That’s because their focus isn’t on access to crypto, it’s on easy cash management, peer-to-peer payments, and the crypto option is just a bonus.
In that same manner, this is probably why their $5.5 billion valuation doesn’t seem as risky as other crypto companies. Crypto is a small part of the portfolio and exposure within the business plan. This diversification serves it well.
In a world where most of the biggest new tech startups have come out of the United States, it is interesting that a pro-crypto banking upstart would come out of Europe.
The biggest competition for Revolut in the United States seems to be Square right now, because of their Cash app. Run by Jack Dorsey, who notoriously has been buying $10,000 of Bitcoin on a weekly basis, Cash only offers Bitcoin and uses it as a key part of their user acquisition funnel.