Blockchain Payments Company Raises $60 Million for Push Into China
June 23 2016 - 7:40AM
Dow Jones News
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.
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.
Last year, China also said it was going to open its domestic
credit-card payments network to foreign competition, which could
pave the way for global firms to operate more easily.
Circle, founded in 2013, currently transmits a fraction of the
payments its rivals do. It is aim is 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.
With the funding, Circle said it would build a team of
developers at Circle China, formed as a separate Chinese company,
and develop a Chinese app.
Jeremy Allaire, chief executive and co-founder of Circle, said
that he believes enabling people to easily pay people overseas with
renminbi is consistent with the government's ambition to make
China's currency pre-eminent globally.
"Chinese consumers will play a much bigger role in the global
economy," he wrote in a blog post with co-founder Sean Neville. The
renminbi "will become a much more important currency in the
world."
Write to Telis Demos at telis.demos@wsj.com
(END) Dow Jones Newswires
June 23, 2016 07:25 ET (11:25 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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