Israel’s digital currency startup, Simplex, has completed its $7 million Series A funding round, bringing the total investment to $8.4 million. The company, which allows users to buy bitcoin with credit card, is now going to be fully launched.
During its previous fundraising in 2014, Simplex received $1.4 million in seed funding. The company’s investors include a number of cryptocurrency mining companies, such as Cumberland Mining, FundersClub and Bitmain, and several angel investors.
Since the company’s launch in 2014, it has already processed more than $3.5 million in transactions. Among its customers are bitcoin cloud mining startup Genesis Mining, bitcoin wallet SpectroCoin and virtual currency exchange Bits of Gold.
The company is led by serial entrepreneur Nimrod Lehavi and former employees of PayPal, Netanel Kabala and Erez Shapira.
Simplex offers an API that lets brokers, exchanges and wallet apps to integrate an option of credit card payments. The company intends to simplify the process of buying bitcoin, while ensuring a reduced risk of fraud.
Users are able to instantly exchange the virtual currency and are not required to register and provide identification documents. Furthermore, unlike traditional exchanges and banks that have minimum transfer requirements, Simplex has no purchase limits, allowing users buy as many bitcoin as they want.
“Banks often place additional restrictions on which countries Bitcoin exchange customers can send wire transfers to. For example, it may be difficult for the average US resident to use a wire transfer to buy bitcoins from countries outside of the US like Slovenia, Hong Kong or China. This clearly creates very high friction and makes mainstream adoption of bitcoin far from easy,” Lehavi told Finextra.
“With Simplex, transactions are convenient, carry less restrictions, and occur almost instantaneously. Bitcoin buyers can use Simplex’s checkout page on Bitcoin exchanges, broker websites, and wallet applications, then proceed with their purchases, as they would on any e-commerce site.”
Simplex has also issued a guarantee allowing sellers and buyers to avoid dealing with chargebacks. In case of chargebacks, all money will be paid only by Simplex. Although the move involves certain risks, the company is likely to reduce them to a minimum due to its anti-fraud strategy. Moreover, Netanel Kabala, who currently serves as the company’s Chief Risk Officer, and Erez Shapira, who works as Simplex’s Chief Technology Officer, both worked in fraud detection at PayPal.