Crypto start-up Argent secures £12m from Yale-backed Silicon Valley fund
A Silicon Valley fund founded by former Sequoia partners and backed by Ivy League University Yale has pumped £12m into a British cryptocurrency start-up.
Argent, a start-up building a cryptocurrency wallet where users can buy and trade cryptocurrency, secured the cash injection from Paradigm.
The start-up is building a cryptocurrency app that aims to mimic the utility of services like Monzo and Revolut.
The app lets users quickly send digital payments to contacts rather than going through a lengthy processes to uncover the cryptographic “keys” that let users trade digital coins.
Despite a surge in prices in 2017, digital currencies like Bitcoin have been held back by a lack of utility and price volatility.
It is hard for ordinary consumers to buy and sell digital coins with many relying on apps that come with high fees or websites that face risks of scammers. Sending cryptocurrency to other people often involves scanning QR codes or entering long digital wallet addresses.
Argent's app strips this out and instead lets consumers send digital coins quickly like a regular bank transfer. Co-founder Itamar Lesuisse said the company was also looking at cryptocurrency savings products.
It will do this by linking its app to other cryptocurrency companies using so-called decentralised applications, which are using blockchain technology.
A blockchain is distributed ledger technology, effectively a record of all transactions that is held independently of Argent. “The logic is on Ethereum. Nobody can tamper with it. All the code is open source so people can verify it,” Lesuisse said.
So far, Argent's app has been available by invitation only as it tests and develops the service.
But such apps face big challenges before they enjoy mainstream popularity. The Financial Conduct Authority has warned cryptocurrencies like Bitcoin are not regulated in the UK, while cases against crypto-firms being investigated by the FCA jumped 74pc last year. Argent also faces a heavyweight force in the shape of Facebook's Libra cryptocurrency, which the big tech firm plans to launch later this year.
Paradigm's investment represents a rare Silicon Valley venture fund participating in the first round of a UK start-up's growth. Paradigm, founded only in 2018, is led by Matt Huang, a former partner at Sequoia, and Fred Ehrsam, co-founder of Coinbase. It is believed to have secured substantial backing from Yale's endowment fund.
Mr Huang said: "Argent has systematically solved some of the biggest usability and security issues in crypto.
Gloss