Mercado Bitcoin, a Latin American digital assets exchange, has raised $ 200 million in Series B funding from the SoftBank Latin America Fund.
The round values 2TM group, the non-operating parent company of Mercado Bitcoin, with $ 2.1 billion and is one of the Top 10 unicorns in Latin America.
Funding comes just a few months later based in São Paulo The Series A round of Mercado Bitcoin (with an undisclosed amount) in January 2021, co-led by G2D / GP Investments and Parallax Ventures, with the participation of HS Investimentos, Gear Ventures, Évora and Genial. JPMorgan and DealMake.
It also comes after an impressive first half for the company. According to Mercado Bitcoin, around 700,000 new customers signed up to use its services between January and May 2021, increasing its customer base to 2.8 million. That is more than more than 70% of the total individual investor According to the company, it is based on the Brazilian stock exchange. Also, the trading volume of Mercado Bitcoin rose to $ 5 billion in the first five months of the year, which is more than the total for the first seven years combined. It is also 11 times the volume in the same period in 2020.
Mercado Bitcoin was founded in 2013 by brothers Gustavo and Mauricio Chamati and was the first crypto exchange in Brazil. The company has been profitable since 2018 and was booted from the beginning through January 2021, reinvesting its cash generation in growth and portfolio expansion, so CEO and 2TM Group Executive Chairman Roberto Dagnoni.
“This makes us a somewhat unique case in the ecosystem and among our fintech peers in general – few companies have managed to balance over 100% year-over-year growth with a positive bottom line,” he told TechCrunch and described Mercado Bitcoin as “The crown jewel “of the 2TM group.
The holding company owns a number of other companies, such as Meubank, a multi-asset wallet and account service currently awaiting a license from the Central Bank of Brazil; Bitrust, a qualified digital custodian and Clearbook, a crowdfunding platform, among others.
In 2019, 2TM Group became the first company in the world to tokenize public debt. Then in 2020 the company issued Futecoin, the world’s first digital asset based on FIFA’s solidarity mechanism.
“We have also tokenized or distributed private debt, carbon credits, and a variety of utility and DeFi tokens,” said Dagnoni. This year, Bitrust will expand the first Latin America-based digital custody service.
“There is much more to come and the Series B round will be a relevant factor in supporting continuous innovation,” added Dagnoni. While refusing to disclose the amount of Mercado Bitcoin’s Series A round, he said it allowed the company to invest around $ 40 million to expand its operations in Brazil this year.
Today Mercado Bitcoin has around 500 employees. That was about 200 a year ago. At the end of the year, Dagnoni expects around 700 employees.
In addition to hiring staff, he said that Mercado Bitcoin / 2TM will also use the new capital to expand its service offering and invest in infrastructure “to meet the growing demand for crypto in the region.” In particular, the company will focus on acquiring new customers and product listings as well as expanding into other countries such as Mexico, Argentina, Colombia and Chile “through a combination of M&A and greenfield operations,” said Dagnoni.
What exactly has brought so much growth to the Mercado Bitcoin? Dagnoni believes that there are a number of factors.
“Millions of people around the world are realizing that digital assets and cryptocurrencies are both innovative in their technological foundations and efficient in storing value, and Brazil is no exception to this trend,” he said.
Plus, the country has seen some of the lowest interest rates on record, which he believes has fueled the development of the alternative investment industry.
“Crypto is taking advantage of this trend, which is also evident in other asset classes such as VC and private equity,” said Dagnoni.
Finally, he believes that the fact that Brazil’s financial services industry is so concentrated has opened up opportunities for fintechs in general in the country.
Paulo Passoni, Managing Partner at SoftBanks SBLA Advisers Corp. (which manages the SoftBank Latin America Fund) called Mercado Bitcoin a “regional leader in the crypto space”, the “to open up a huge local and regional addressable market. “
He added, “At SoftBank, we want to invest in entrepreneurs who are challenging the status quo through technology-driven or technology-enabled business models that are revolutionizing an industry – Mercado Bitcoin does just that.”
SoftBank has recently started operating in Latin America. At the beginning of June, the Japanese investment group announced that it would invest “up to 150 million US dollars” in Grupo Bursátil Mexicano (GBM), a 35-year-old investment platform on the Mexican stock market.