Digital currency firm Circle has raised $50 million (£33m) in a funding round with Goldman Sachs and IDG Capital Partners of China.
In addition, the bitcoin firm is giving Circle customers the ability to hold, send and receive US dollars with no fees, and avoid holding bitcoin accounts, which may or not seem like going against the brave new world of digital currency.
Goldman Sachs and IDG Capital Partners were joined by all of Circle’s existing investors in the funding round, including Breyer Capital, General Catalyst Partners, Accel Partners, Oak Investment Partners, Fenway Summer, Digital Currency Group, Pantera Capital and strategic individuals.
Circle founder Jeremy Allaire said: “We could not be happier with our new strategic investors. They bring unique, powerful capabilities and capital that will help us continue building a new kind of global consumer finance company, one based on open platforms, open source software and ubiquitous mobile devices.”
Tom Jessop, managing director of Goldman Sachs’ principal strategic investments group, said: “As the financial services industry continues to become more digital and open, we see significant opportunities in companies and solutions that have the promise to transform global markets through technical innovation.
“We think that Circle’s product vision and exceptional management team present a compelling opportunity in the digital payments space.”
Customers holding dollar accounts with Circle will gain all of the benefits of digital currency, including instant, secure and free payments to anyone in the world. If customers choose to hold dollars instead of bitcoin balances, they can still pay any person or merchant who accepts payment in bitcoin, without ever holding bitcoin themselves. Circle will handle instant conversion from dollars into bitcoin at the time of the payment.
Customers can also accept bitcoin and Circle will convert it instantly into dollars in their Circle accounts. “This gives customers the benefits of bitcoin payments without the risk of price volatility,” said Allaire.
Quan Zhou, managing director of IDG Capital Partners, said: "Consumer finance is undergoing a profound transformation with the rise of mobile payment applications and a growing appetite for financial products from non-traditional providers.
“We feel that Circle is strongly positioned to capitalise on these trends. We are very excited about our investment and look forward to helping launch the company in the Chinese market where consumer adoption of innovative digital payment products is growing at a tremendous rate."