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- VelaFi raises $20M to expand payment infrastructure across regions.
- Stablecoin adoption drives VelaFi’s growth in Latin America and Asia.
- $40M total funding positions VelaFi for global enterprise payment expansion.
VelaFi, a stablecoin-based financial infrastructure company backed by Galactic Holdings, has raised $20 million in its Series B funding round. The new capital inflow results in the company’s overall capital exceeding $40 million, which can be attributed to the high growth of the company in Latin America, the United States, and Asia. IVC and Ikuyo led the Series B round, indicating that investors had high confidence in the innovative nature of VelaFi in making enterprise payments.
VelaFi aims to offer the latest payments infrastructure that integrates local banking, global transfer, and stablecoin protocols. Fiat’s offerings include on- and off-ramps, cross-border payments, foreign exchange workflows, and multi-currency treasury services. These are offered through VelaFi’s platform and APIs, allowing businesses to simplify their international financial operations.
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Expansion Strategy to Tap into Growing Global Demand
The new capital will help VelaFi accelerate its geographical growth and licensing activities, as well as expand its cross-border payment infrastructure. The company has started in Latin America and has already entered the U.S. and Asia, although it has just entered the Japanese market. VelaFi has also become a member of the Stablecoin Settlement Association as a part of its growth strategy, which is a massive initiative to modernize the Japanese trade finance industry.
VelaFi has been gaining momentum in Latin America due to the region’s increased demand for more dependable financial options. The use of Stablecoins has increased significantly, primarily due to high inflation rates and the reliance on remittances. Chainalysis records that purchases of stablecoins have become over 50% of all exchange transactions involving major currencies, including the Colombian peso, Argentine peso, and Brazilian real.
Institutional Interest Surges Amidst Growing Regulatory Concerns
Although stablecoins are gaining popularity, regulatory agencies in the region have expressed concerns. An example is the central bank of Mexico, which threatened that the sudden growth of stablecoins may be a threat to financial stability. Stablecoins are increasingly becoming part of conventional financial systems, a situation that regulators fear could exacerbate market stress in the event of instability.
Despite these regulatory issues, a significant institutional interest in stablecoins remains. The issuer of the largest stablecoin in the world by market capitalization, Tether, recently invested in Parfin, a firm based in London and Rio de Janeiro. The strategic investment indicates that the role of stablecoins in the emerging institutional digital asset market of Latin America is increasing.
The further development and investment in VelaFi are a sign of the increased role of infrastructure based on stablecoins in transforming international payment systems and settlements. With the additional capital, VelaFi will gain the prospect of harnessing the potential and meeting the expansive market demands for consistent financial solutions in new markets.
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