As Bitcoin is on fire and traction continues to increase every day, there’s a massive push for official institutions that support and solidify the industry. These institutions serve as foundations and set the trends to paves the road for the future. One such company is LedgerX, the first firm that has applied to be a regulated bitcoin exchange and clearing house that would allow you to obtain and hedge bitcoin using exchange-traded and centrally-cleared options contracts. Operated by some of the savviest minds in finance from Goldman Sachs, MIT and CFTC, LedgerX is bringing accessibility and infrastructure support to Bitcoin at an institutional level. If you though Bitcoin was surging now, just wait until the institutions are able to trade it.
AlleyWatch spoke with CEO Paul Chou about the company and discussed their most recent round of funding.
Who were your investors and how much did you raise?
We raised a Series B round of $11.4 million dollars led by Miami International Holdings and Huiyin Blockchain Venture Investments.
Tell us about your product or service.
We intend to provide a regulated platform for trading Bitcoin and other the digital currencies.
What inspired you to start the company?
The idea of open access to finance from a computer science innovation, was our biggest inspiration.
How is it different?
It’s different in that nobody has started a clearing house and exchange for Bitcoin in the united states so far.
What market you are targeting and how big is it?
The market for democratized access to finance is likely enormous, but hard to quantify.
What’s your business model?
We take a transaction fee for every Bitcoin trade that is done.
Bitcoin has been on fire lately. Where do you see the price a year from now?
Impossible to predict, but in the long term the price potential is extremely positive.
What was the funding process like?
The funding process is always a long one. Discussing the potential of the company with future partners takes quite a bit of time. But when you find the right investors, which we have, it can be incredibly beneficial for the business.
What are the biggest challenges that you faced while raising capital?
The unique aspects of a novel market like Bitcoin often takes significant education and pitching, so I would say those were the biggest issues as we raised capital.
What factors about your business led your investors to write the check?
The strength of the executive team and the approach are by far the biggest drivers, and in that order.
What are the milestones you plan to achieve in the next six months?
Full regulatory approval and a good volume of derivatives traded on a US exchange are the most important milestones.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
Where do you see the company going now over the near term?
Giving our customers a solid, regulated trading platform to enhance their own operations.
What’s your favorite rooftop bar in NYC to unwind?
Hotel Gansevoort or Ink 48.