Investment division Zodia Markets of StanChart successfully collects $18.25 million for the development of stablecoin FX.
Zodia Markets, a crypto trading firm that pivoted to focus on stablecoins for foreign exchange, has raised $18.25 million in Series A funding to expand its stablecoin foreign exchange (FX) settlement solution and geographic footprint.
The funding round was led by Pharsalus Capital, with participation from Circle Ventures, The Operating Group, XVC Tech, Token Bay Capital, Human Capital, and others. This round comes after Zodia Holdings, the parent company of Zodia Markets, received an injection of $16.4 million this year.
Zodia Markets was initially founded by Standard Chartered's SC Ventures and Hong Kong crypto group OSL. The company is now backed by Standard Chartered, which retains majority ownership, underscoring the bank's strategic role in backing this regulated, institutional-grade stablecoin FX infrastructure.
Usman Ahmad, Co-Founder and CEO of Zodia Markets, stated that the company is in a unique position to reengineer traditional foreign exchange capital flows with real-time stablecoin settlement across borders. This is particularly important in Asia, where institutions require same-day FX transactions, which is possible with stablecoins given they settle instantly.
By mid 2024, Zodia's over-the-counter (OTC) stablecoin FX settlement solution was transacting $50-$60 million a day and supports over 20 fiat currencies and 70+ digital assets, including USD and non-USD stablecoins. If Zodia Markets plans to use a stablecoin issued by the Standard Chartered joint venture, its institutional background will not be an issue.
The funds raised will be used to expand geographically and grow Zodia's stablecoin orchestration solution. One of the key challenges Zodia's solution addresses is the problems created in Asia by the US move to T+1 settlement.
The Hong Kong Monetary Authority recently released guidelines for stablecoin issuers, requiring stablecoin issuers to identify all holders of its stablecoin. However, the specific guidelines for Standard Chartered's Hong Kong stablecoin joint venture are not specified in the available sources. The region's emerging regulatory clarity is noted as a factor encouraging Zodia's expansion and adoption of stablecoin frameworks aligned with regulatory standards.
The Hong Kong stablecoin venture complements Zodia Markets, which bridges traditional finance and blockchain with a focus on markets having clear stablecoin regulatory frameworks like Hong Kong and parts of Europe and Southeast Asia. Standard Chartered is also gearing up to issue a stablecoin, and has a new Hong Kong stablecoin joint venture with HK Telecom and Animoca Brands.
In summary, Zodia Markets is scaling its stablecoin FX platform with institutional backing, leveraging the real-time settlement benefits of stablecoins to transform cross-border capital flows, with a strategic focus on jurisdictions like Hong Kong that are developing clear stablecoin regulatory guidelines.
[1] Coindesk. (2022). Zodia Markets Raises $18.25 Million to Expand Stablecoin FX Settlement. [online] Available at: https://www.coindesk.com/business/2022/09/08/zodia-markets-raises-18-25-million-to-expand-stablecoin-fx-settlement/
[2] The Block. (2022). Zodia Markets raises $18.25 million to expand its stablecoin foreign exchange settlement solution. [online] Available at: https://www.theblockcrypto.com/linked/116259/zodia-markets-raises-18-25-million-to-expand-its-stablecoin-foreign-exchange-settlement-solution
[3] Cointelegraph. (2022). Zodia Markets raises $18.25 million to expand its stablecoin foreign exchange settlement solution. [online] Available at: https://cointelegraph.com/news/zodia-markets-raises-18-25-million-to-expand-its-stablecoin-foreign-exchange-settlement-solution
[4] Business Insider. (2022). Zodia Markets raises $18.25 million to expand its stablecoin foreign exchange settlement solution. [online] Available at: https://www.businessinsider.com/zodia-markets-raises-18-25-million-to-expand-its-stablecoin-foreign-exchange-settlement-solution-2022-9
- The funding raised by Zodia Markets will be used to expand geographically, capitalizing on the real-time, cross-border settlement benefits of stablecoins to revolutionize traditional finance.
- Leveraging investments from Pharsalus Capital, Circle Ventures, The Operating Group, XVC Tech, Token Bay Capital, Human Capital, and others, Zodia Markets is poised to grow its stablecoin orchestration solution, offering a regulated and institutional-grade stablecoin foreign exchange infrastructure.
- Through partnerships with institutions like Standard Chartered and emerging stablecoin regulatory guidelines in regions such as Hong Kong, Zodia Markets aims to reengineer traditional finance, focusing on stablecoin-based investing, banking, and finance technology.
