At a Glance
XREX, a blockchain TradeTech firm, has secured $17 million in a pre-Series A round led by CDIB Capital Group that was oversubscribed. Part of the funds raised in the most recent round will be used to apply for financial licenses in Singapore, Hong Kong, and South Africa.
XREX, a blockchain TradeTech company, has announced that it has raised $17 million in an oversubscribed pre-Series A round led by CDIB Capital Group. Other participants include SBI Investment (a subsidiary of SBI Holdings), Global Founders Capital, ThreeD Capital, E.Sun Venture Capital, Systex Corporation, MetaPlanet Holdings, AppWorks, BlackMarble, New Economy Ventures, and Seraph Group.
Part of the latest round will be used to seek financial licenses in Singapore, Hong Kong, and South Africa and form partnerships with banks and financial organizations such as payment gateways.
We specifically wanted to build a regulatory-friendly cap table. It’s really hard for a startup like us to raise from banks and public companies, but as you can see, this round we deliberately to do that, and we were successful.Wayne Huang, co-founder and CEO of XREX
XREX Crypto Services provide businesses with tools to perform digital fiat currency trades, particularly in areas with limited US dollar liquidity. “They need immediate access to the US dollar and the ability to pay it out quickly enough to secure vital goods that they want to import, and that is the problem we want to solve,” Wayne explained.
To use the platform, merchants and their consumers must join up for XREX’s wallet, which includes a commercial escrow service called Bitcheck. It’s akin to getting a standby letter of credit from a commercial bank, according to Huang, because buyers may use it to ensure they’ll be able to pay. Bitcheck makes use of stablecoins like USDT and USDC, which are digital currencies pegged to the US dollar.
Merchants pay stablecoin to suppliers, and XREX holds the funds in escrow until the supplier presents evidence of shipment, after which it releases the cash. Users can convert USDT and USDC to US dollars through XREX’s crypto-fiat exchange, which they can also withdraw and deposit.
Part of the funds raised will go into expanding XREX’s fiat currency platform, though Wayne says the company won’t include too many cryptocurrencies because “we’re not created for crypto traders, we’re built for businesses, and brand matters to them.” Brand and compliance, therefore they’ll adopt whatever the US Comptroller of the Currency believes is a decent stablecoin.”
CDIB was an early investor in XREX. After witnessing the company’s fast revenue growth and their commitment to compliance, we were determined to double our investment and lead this strategic round.Ryan Kuo, head of CDIB Capital Innovation Fund
Compliance and anti-money laundering companies such as CipherTrace, Sum&Substance, and TRISA are among XREX’s partners. A portion of the funds raised by XREX will be utilized to improve the company’s security and compliance features, such as Public Profiles, which are required for customers, and the user Reputation Index, which will increase transparency.