NEW YORK, March 31 (Reuters) - OpenFX, a startup that focuses on foreign-exchange market making and remittances, on Tuesday raised $94 million in a funding round led by several venture capital firms, as it looks to use stablecoins to speed up cross-border payments.
The capital raise, led by investors including Accel, Atomico, Lightspeed Faction, M13, Northzone and Pantera, comes amid growing interest in using stablecoins to modernize cross-border payments and overcome high costs and transfer delays.
The funding round valued OpenFX at about $500 million, according to a person familiar with the matter.
Market infrastructure firms such as OpenFX are using blockchain-based currencies to offer faster and cheaper transactions, particularly for businesses moving large sums of capital.
The company's founder Prabhakar Reddy got the idea of launching OpenFX after seeinglong queues of people waiting outside Western Union branches in Dubai to collect money. Reddy started OpenFXin 2024.
"You can easily do transfers for anywherebetween $1,000 and $100,000 - but the minute you tried to do anything between $1 million and$10 million clip sizes,you eat through the order book," said Reddy in an interview.
"There are very few people in the world who are actually willing to pay 2% to 5% to move USD to euro - so that's when I realized that the infrastructure was broken."
Reddy's previous ventures include crypto prime brokerage business FalconX. He said more than 98% of transactions on OpenFX's platforms settle in under 60 minutes. That compares with two to five business days in the legacy forex market.
OpenFX links traditional banking systems with digital infrastructure, using stablecoins as a bridge to enable near-instant FX conversion.
The latest funding will finance the firm's expansion into Southeast Asian markets and Latin America where adoption of stablecoins is rising quickly, the company said.
OpenFX, which raised $23 million last year and currently operates in the U.S., UK, UAE, and India, said it helps process over $45 billion in annualized payment volume, up from $4 billion a year ago, driven by demand from fintech companies, neobanks, remittance providers and payroll platforms.
"Just as AWS removed the complexity of infrastructure to let developers build at scale, OpenFX is doing the same for money movement. Their global liquidity rails, paired with always-on, real-time settlement, unlock a step change in cross-border financial infrastructure," said Niklas Zennström, founder and CEO of Atomico.
(Reporting by Anirban Sen in New York and Manya Saini in Bengaluru; Editing by Sam Holmes and Arun Koyyur)
