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Liquid becomes crypto’s latest “billion-dollar baby”

Chinese cryptomining manufacturer Bitmain Technologies and investment company IDG Capital have partnered to provide financial backing for crypto platform (known as Liquid) – a privately owned start-up owned by Japanese fintech company Quoine.

The backing now gives Liquid unicorn status – after the first close of ongoing Series C funding, Liquid is valued at more than $1 billion USD.

Liquid’s mission statement is “financial inclusion for all”, with cryptocurrency the means of achieving this, it says.

Parent company Quoine is licensed by Japan’s Financial Services Agency.

Second crypto “unicorn” born

The funding and latest valuation means that Liquid is now the second fintech start-up company with unicorn status, after Coinbase. The term “unicorn” was coined by venture capitalist Aileen Lee in 2013 to reflect the rarity of such companies.

Liquid says the new backing from Bitmain and IDG Capital – an undisclosed amount – will fund global expansion of the platform and product development. The company is also planning a move into the security token marketplace.

Quoine said Liquid was launched to provide access globally to “a worldwide network of cryptocurrency exchanges”.

The platform had already raised more than $20m from venture funding, mainly from leading Japanese investment companies, including JAFCO, SBI, ULS Group and B Dash Ventures. Initial fundraising in 2017 netted the platform more than $100m in an FSA-regulated pre-discounted ICO.

Of the recently announced backing, Liquid, CEO Mike Kayamori, said:

“Our vision is to make financial services accessible to all, which means bringing more people into the digital asset space, so that anyone can be a part of it.”

Bridge to the future world of finance

In the year 2017-2018, Liquid traded $50b USD, leading it to state that it believed it would be “the bridge to the future world of finance”.

“By simplifying crypto and its underlying financial tools, we can make crypto accessible to everyone,” says the company.

“The future of finance is distributed. Democratization of finance has begun. The power is in everyone’s hands. The crypto economy is here.”

In late March, Liquid announced a new and improved trading fee structure, with a flat maker/taker fee of 0.05% for trades on all crypto, fiat and stablecoin pairs for customers paying fees with QASH.

The new fee-structure also encourages high-volume traders with a trading fee rebate scheme that can “effectively reduce your fees to zero”. Liquid says that traders trading more than $25m USD per calendar month will be eligible for the rebate, which will be paid in QASH.

“The more you trade, the higher your rebate,” says Liquid.

Liquid goals

The platform says it prides itself on a “progressive set of goals”, including attracting traders, retaining high levels of liquidity and market expansion.

“Juggling all three can be tricky,” the company admits in its blog. “Market makers have to be incentivized to create the market by placing an order either to buy a currency below the market price, or to sell a currency above the market price.

“But we also have to focus on basic principles of market strategy: growth and customer retention.”

Bitmain co-founder and backer, Jihan Wu, said:

“Japan is one of the leading nations in putting crypto industry under proper regulations – and Liquid Group has proven itself to be the exemplary player within such compliant rules.”

Liquid backer IDG Capital has also invested in other crypto companies that include the first crypto unicorn, Coinbase, as well as Circle and Ripple – and crypto start-ups such as KuCoin and imToken.

Bitmain image licensed via Shutterstock

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