Kraken, a San Francisco-based crypto exchange reported today it has was able to raise about $13.5 million in fresh funding through BnkToTheFuture, a crypto investment service.
Kraken, was formerly known as Payward Inc., has put plans in place to use the new funds to make new acquisitions and expand its current business operations.
The fundraising effort was backed by 2,263 investors who invested to Kraken through a “special purpose vehicle.” Under the deal, the investors are seen as a single capital investor and they don’t become Kraken shareholders.
“The SPV then pools all the individual funders and acts as a single capital investor,” CoinDesk explained. “This technique allows Kraken to bypass the SEC requirement that force it to register as a public company under the 1934 Securities and Exchange Act.”
Consequently, the investors get a return on their investment when Kraken goes public or if it gets acquired by a larger firm, or if the crypto exchange agree to a management buyout.
Investing in this offering which came with a minimum investment of $1,000, the offering is laced with extra benefits. These benefits include Kraken’s CryptoWatch Premium membership, the capacity to use the investment for margin collateral, priority customer care. Kraken reports would come with a free subscription and they’d have access to investor chat rooms, plus free Kraken swag and several other benefits.
The figure raised by Kraken is somewhat small given that it’d raised more about a $100 million and is profitable from the looks of things. The goal of using the funds for more acquisitions is kind of surprising as well, although maybe Kraken needs the extra capital after they spent a 9-figure sum to acquire United Kingdom’s crypto exchange and indices company Crypto Facilities Ltd. in February this year.
For BnkToTheFuture, it is another decent-sized round for a firm that’s the go-to website for crypto related fundraising. Their investment alumni consists of Circle Inc., BitStamp Ltd., Shapeshift Coinbase Inc., BitFinex (iFinex Inc.), and Ripple Labs Inc.
Established in 2010, the firm itself has raised funds from investors directly, including $33 million in an ICO (initial coin offering) in February 2018. BnkToTheFuture has always been keen to shy away from the news, they were last heard from in June 17 when they acquired Altcoin.io, a decentralized crypto exchange.