Blockfinex, a Barbados and Seychelles-registered crypto exchange company, has acquired a 100% stake in Nigerian crypto payment gateway startup, Fluidcoins for an undisclosed sum. The founding team of Fluidcoins will continue to work on the product, making this an acquihire. The news of the acquisition, first reported by TechCabal, was confirmed by Danny Oyekan, the founder and CEO of Blockfinex. Dan Holdings Limited, a web3 ecosystem and venture fund, and the parent company of Blockfinex, facilitated the deal.
“This acquisition was driven by a decision to venture into Wallet as a service business and crypto payment processing and scale it across the world,” Oyekan told TechCabal. The acquisition includes all Fluidcoins entities, including Flip and Fluidshops. Flip by Fluidcoins, a crypto wallet launched about five months ago, allows users to earn interest on their stablecoins, purchase airtime, top-up virtual calls, and send peer-to-peer social payments within the app. Fluidshop, on the other hand, is a free online store created for entrepreneurs, freelancers, businesses and digital product owners. It helps them to showcase their products and services, make sales and accept payments in cryptocurrency, particularly stablecoins.
Blockfinex will use this acquisition to go further
In a statement shared with TechCabal, Blockfinex also said that it will leverage this acquisition to launch a new product, BlockPay, which will be available in the UAE, US and Africa. BlockPay will be a payment processor and API Wallet-as-a-service provider. It will also continue to facilitate payments for Fluidcoins existing clients like Accrue, The Peer, and GetEquity amongst others.
Blockfinex will now use Fluidcoins Wallet-as-a-service product to reach over 600+ Cryptocurrencies and will also expand Fluidcoins Checkout businesses to serve more businesses across.
Fluidcoins acquisition will deepen crypto’s “utility phase”
Founded by Lanre Adenowo in 2021, Fluidcoins says on its website that it’s building a crypto economy for African businesses by ”providing them with the tools to participate in the DeFi economy, accept online and offline stable-coin payments, international payments.” Adenowo serves as the company’s CEO and CTO.
One of the biggest hindrances of crypto is utility and a constant question is how crypto can be integrated into real world uses. Fluidcoins’ answer to this has been on the payment side by making crypto payment as easy as fiat payment. Fluidcoins is, for instance, Paystack but for crypto. This, according to Oyekan, is a major attraction to the business. “As we move to the crypto utility phase, facilitating traditional businesses and consumers alike to make payments for real world services with crypto is going to be a game changer for the crypto industry over the long term.”
This deal is Nigeria’s first reported acquisition deal for 2023 and the first after Flutterwave’s acquisition of Disha last year. Most importantly, the deal is the first in the country’s crypto ecosystem.
A fire sale
The crypto bull run in 2021 produced a lot of crypto believers in the VC space. Some of the biggest VCs even raised funds specifically for crypto and web3. This surge in investors’ interests spilled over into Africa and startups building in the crypto space or web3 have collectively raised hundreds of millions of dollars in venture funding. But a 2022 bear run created a hole in the confidence of enthusiasts; investors reassessed their interest in crypto and startups began to struggle to raise while users searched elsewhere for the next big thing. The recent FTX collapse created even more damage to an already fledging interest in the sector.
Fluidcoins, like many companies in today’s market, found it difficult to raise follow-on funding to scale its offering. Fluidcoins had only raised about $150,000, which has kept it afloat for the last 18 months, Adenowo said. He declined to comment on this acquisition but agreed it’s the logical next step to keep the lights on as the company is running out of cash.
Oyekan told TechCabal that this is an acquihire deal and the team will stay intact. “There will be no management or staff changes.”