Crypto startup FalconX raises $150M to grow its digital asset trading platform; now valued at $8 billion

With fears of uncertainty sweeping across the crypto market, it’s becoming increasingly difficult for crypto startups to raise new funds. Struggling startups have turned to capital preservation measures including layoffs to keep their business afloat.

However, the unfavorable market environment for cryptocurrencies has not stopped investors and venture capital firms from pouring billions into startups in promising crypto startups like FalconX. We covered the company in December 2021, FalconX also raised a $50M investment from Tiger Global and B Capital Group after reporting a 46X net revenue growth.

Fast forward six months later, FalconX announced today it has a total of $150 million from new and existing investors, bringing fresh capital to the company. The round was led by GIC and B Capital, with participation from Thoma Bravo, Wellington Management, Adams Street Partners and Tiger Global Management.

This latest round more than doubles the value of FalconX after its Series C raise in August 2021 which valued the company at $3.75 billion. To date, FalconX has now raised more than $430 million in total funding, making it one of the most valuable crypto prime brokerages in the world.

But not all the funds will go to the company’s coffers as some investors also sold an undisclosed stake in FalconX. The company will use some of the funding proceeds to increase its workforce by 30% and add 55 new employees to the company.

It also plans to use the new cash infusion for new acquisitions, technology, and data analytics, expanding its services to institutions from trading execution, credit, and prime brokerage, FalconX CEO Yarlagadda said.

“Over the next 12 to 18 months, we do expect a very volatile market. And, given that volatility, we see very strong opportunities for acquisitions,” Yarlagadda told Reuters.

FalconX is a Silicon Valley-based cryptocurrency brokerage and digital asset trading platform that uses data science to provide institutions with trading, credit, and clearing.

FalconX was founded in 2018 by Raghu Yarlagadda and Prabhakar Reddy. Raghu is an engineer and an entrepreneur. Prior to co-founding FalconX, he worked at Google, where he was instrumental in scaling Chromebooks to $3 billion in revenue for Google and its partners. Prabhakar, an engineer, and a serial entrepreneur exited his last venture to an Accel Partners portfolio company, prior to joining Accel as an investor.

FalconX is an all-in-one digital asset platform facilitating trading, credit, and clearing for institutions. Since its inception, FalconX has generated over $7 billion in global trading volume at a quarterly growth rate of over 600%. Clients include over 100 financial institutions across traditional finance including hedge funds,

Over the last year, the profitable FalconX has grown its net revenue 46X, driven by increased demand for cryptocurrencies from institutional investors seeking an inflationary hedge in an unprecedented macroeconomic environment.

The startup has also seen exponential growth from traditional allocators who turn to the platform for a white glove experience through the entire trade lifecycle – growth client segments including Fortune 1000 corporate treasuries, family offices, registered investment advisors, and other traditional enterprises.