Mobile Banking App Dave Secures $100 Million FTX Investment To Boost Crypto Presence

Dave, the digital banking software that went public on the Nasdaq two months ago, is stepping up its cryptocurrency ambitions following a new $100 million investment from crypto exchange FTX.

Dave Inc. established a strategic agreement with West Realm Shires Services, Inc., the owner and operator of FTX US, on Tuesday to further develop the digital asset economy.

FTX US is the exchange’s affiliate in the United States, offering cryptocurrency trading, an NFT marketplace, and payment services via FTX Pay.

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FTX was founded in 2018 by MIT graduate Sam Bankman-Fried and announced the establishment of the $2 billion FTX Ventures fund in January.

Simultaneously, FTX announced the close of a $400 million Series C investment round, valuing the exchange at $32 billion.

FTX US President Brett Harrison said in a news release:

“We are constantly on the lookout for companies that share our vision, have innovative and disruptive business models, and can assist in accelerating the adoption of digital assets.”

Dave And FTX Collab On Crypto

“Dave is an excellent match since they meet all three criteria,” he continued.

Dave is a financial technology company established in the United States with over 6 million users. It offers consumers a budgeting and credit-building product, as well as a cash advance service.

Dave is the latest in a long line of payment applications exploring the possibility of offering cryptocurrency services.

Crypto total market cap at $1.87 trillion on the daily chart | Source: TradingView.com

PayPal added cryptocurrency compatibility in March, and as recently as January, it announced plans to establish its own stablecoin.

Venmo, which is owned by PayPal, also added cryptocurrency functionality in August, allowing credit cardholders to earn “cash back” in bitcoins.

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Proceeds For Acquisitions

Dave CFO Kyle Beilman said Tuesday during Dave’s fourth-quarter earnings call that the business may also use the proceeds from FTX to seek acquisitions, which he called as a “attractive component of our growth and capital allocation plan.”

FTX’s $100 million investment is not in the form of shares but rather in unsecured convertible notes — a type of short-term debt — with a 3% annual interest rate.

Among the others that invested in Dave are Mark Cuban, owner of the Dallas Mavericks, Capital One Ventures, music artist Thomas Wesley Pentz, and Quincy Smith, co-founder of CODE Advisors.

Meanwhile, Dave’s stock closed up 4.85 percent on Monday and was up nearly 3% in after-hours trade. Additionally, the corporation released fourth-quarter profits after the market closed on Monday.

Featured image from Decrypt, chart from TradingView.com