Sequoia and Tiger Global invest $40m in China's Babel as part of its push into crypto

 

Babel Finance, a Chinese start-up offering financial services to cryptocurrency clients, raised $40 million from investors including Sequoia Capital China and Tiger Global, the latest in a spate of venture capital deals fueled by Bitcoin’s rally.

The early stage fundraising is led by Zoo Capital, Sequoia Capital China and Dragonfly Capital and joined by Tiger Global and BAI Capital, the firm said on Monday, without disclosing its valuation. Its new backers will help Babel expand across Asia, North America and Europe, the start-up added.

As of February, Babel has served about 500 institutional clients and its core lending business has reached $2 billion in active outstanding loans.

Babel is one of a crop of fledging crypto ventures taking advantage of the boom in digital assets to build up their war chests. Bitcoin took off in October, hitting an all-time high of $64,870 in April before paring some gains in recent weeks. In just the last two months, Tiger Global has invested $25m into CoinSwitch Kuber, a Bangalore-based exchange that’s also backed by Sequoia Capital India, while crypto-wallet app maker imToken raised $30m from investors including Qiming Venture Partners and Breyer Capital.

“Bitcoin was some sort of alt asset for a long time,” Babel founder Flex Yang said in a Zoom call from Beijing. “But now that it has a $1 trillion market cap, people will think of it properly as a new asset class."

Founded in 2018, Babel has recently delved into newer businesses like asset management and derivatives trading, after expanding its client base beyond China’s crypto miners, said Mr Yang, a 33-year-old accountant by training. His previous venture offered loans to young entrepreneurs underserved by banks.

Mr Yang envisions attracting one million Bitcoins into Babel’s services in four years, up from 100,000 currently. The firm seeks to double its headcount to 100 people this year, he said.