Swiss-based digital currency exchange ShapeShift announced this week it has closed a funding round in which it raised $1.6 million.
Led by Barry Silbert’s Digital Currency Group and Roger Ver, participants in the round included Bitfinex, Bitcoin Capital, Mardal Investments and prominent industry angels, including Bruce Fenton, Trevor Koverko and Michael Terpin.
“ShapeShift demonstrated an entirely new way to think about asset exchange,” said Zane Tackett, Bitfinex’s director of community and product development, in a press release sent to CoinReport. “It’s like Google Translate for digital currencies. We’ve known [ShapeShift CEO Erik Voorhees] for a while now and he’s knocked it out of the park with this one. We’re very excited about the partnership.”
Since launching in August 2014, ShapeShift has registered 100 times growth; in July alone the company achieved more than $2 million USD-equivalent volume.
As TechCrunch explained in its article about ShapeShift’s fundraising round, ShapeShift is a universal and anonymous digital currency converter that is non-custodial, meaning it does not hold client funds.
Say you wish to obtain Litecoin. You’d give ShapeShift a deposit address and then deposit another currency, perhaps Bitcoin, into a deposit wallet. The platform then converts the currency automatically without having to record your personal data. Because of this function, said TechCrunch, you can buy any of the 40 leading currencies and assets on the platform and then convert them into Bitcoin immediately.
“I launched this project to demonstrate that currency exchange could be handled completely differently than anything done before,” said Voorhees in an interview with TechCrunch. “Cryptocurrencies allowed non-custodial exchange, without users having to sign up or create accounts. This is impossible with fiat currencies, and yet every Bitcoin exchange was modeled after fiat currency exchanges. ShapeShift, like SatoshiDICE before it, demonstrated how an old business could operate in a brand new way because of the properties of cryptocurrencies.”
The company’s “no fiat” model also extends to its business operations, as it pays all salaries, server costs and marketing and legal expenses in Bitcoin.
TechCrunch reported that, all told, there are 1,300 currency combinations available to users, which Voorhees said was a “FOREX record.”
In its report on ShapeShift’s fundraising round, SiliconANGLE said the company has raised nearly $2.4 million to date. The company plans to use the new funds to support development, improve liquidity and enable additional scalability.
Images courtesy of ShapeShift