ConsenSys on Verge of Completing $3 Billion Valuation Deal

ConsenSys is looking to close a funding deal that could give the Ethereum blockchain technology company a $3 billion valuation, according to a Financial Times report. Back in April, the New York-based firm raised $65 million from financial powerhouses such as JPMorgan, Mastercard, and UBS. ConsenSys termed this process, which also included some leading decentralized companies (DeFi), a ‘formation round.’ It however declined to comment further on the fundraising. Nonetheless, securing the financing would mark an important milestone for the seven-year-old company.

Founded in 2014 by Ethereum co-founder Joseph Lubin, ConsenSys develops and supports projects built on the Ethereum blockchain. The platform has shifted away from consulting and services towards a larger focus on products. This includes developing apps for financial services among others. For example, ConsenSys is the developer of MetaMask, a DeFi-centric service that has facilitated over $9 billion worth of trade, primarily through its digital token swap feature. Furthermore, according to the Financial Times, MetaMask projects to rake in an additional $1 billion within the next 12 months.

MetaMask Institutional

MetaMask launched MetaMask Institutional back in December. According to a press release, the intention was to bring increased DeFi exposure to crypto funds, market-makers, and trading desks. The eponymous institution performs a wide range of features in the DeFi space. These include the integration of institution-compliant custody, operational, risk, and other compliance features.

In addition, since its inception late last year, MetaMask has facilitated over $8.9 billion worth of trades. According to the same report, it achieved this through a special feature that enables the exchange of digital tokens between parties. Also, product lead for MetaMask Institutional, Johann Bornman, weighed in on the aforementioned Tuesday release. Bornman said, “MetaMask Institutional’s focus is to provide unrivaled access to DeFi even in the face of rigorous institutional requirements.” In addition, Bornman concluded by saying, “Qualified custodians and custody technology play a fundamental part in these requirements.”

ConsenSys Projected $3 Billion Valuation Reflects a Booming Sector

ConsenSys founder Joseph Lubin went through several public missteps in a bid to take advantage of blockchain technology. For example, the former Ethereum co-founder made staff cuts of over 10% on at least two occasions. Furthermore, ConsenSys went through a restructuring in 2020 that saw its investment arm splitting off into a separate entity.

However, the soaring price of BTC and other crypto assets is causing an influx of investor funds into the space. Many of these investors are banking big on the fast-growing but still relatively risky and largely unregulated crypto sector. For instance, so far this year, the amount of funds invested in crypto startups by venture capitalists is about $20.7 billion. This figure represents an over 160% increase from the previous record in 2018.

A recent example of large investment valuations for startups is that of Axie Infinity. The development team behind the popular crypto-based video game on Tuesday announced it raised $150 million in funding.