Exclusive: Stablecoin startup Agora raises $50 million Series A led by crypto VC giant Paradigm

SEE FULL BIO From left: Agora cofounders Joe McGrady, Nick van Eck, and Drake Evans

Courtesy of AgoraOn Thursday, Agora became the stablecoin company to attract the attention of deep-pocketed venture investors, as the crypto startup announced a $50 million investment led by the blockchain-focused VC firm Paradigm

Cofounded by Nick van Eck—son of the minent investment management CEO Jan van Eck—along with crypto veterans Drake Evans and Joe McGrady, Agora is competing in an increasingly crowded space dominated by rivals including Circle and Tether

Agora offers a white-labeling service to other companies, allowing them to launch their own, self-branded version of AUSD that is able to take advantage of the underlying stablecoin’s interoperability and liquidity. “What we wanted to do is really something novel, which is start by building the network,” van Eck told Fortune. “We always had the view that we were going to do white-labeled issuance in a different way to how existing peers had done it. ” Stablecoin explosion Though the blockchain industry has long been dominated by the leading cryptocurrencies Bitcoin and Ethereum, stablecoins have emerged over the past year as a target for venture investment

The sector has long sought a “killer app” that will drive adoption beyond speculation, with stablecoins mising a kind of digital dollar that allows near-instantaneous and low-fee transactions between people and companies, and across borders

But as more companies, including non-crypto giants Meta and Apple, dip their toes into stablecoins, Agora is making the bet that there will be multiple winners, especially if they help foster adoption

Un Tether and Circle, Agora’s model is built around helping other companies launch their own stablecoins, similar to Paxos, another early mover in the space that worked with PayPal to launch PYUSD

But un Paxos, any company working with Agora will launch its stablecoin on top of AUSD, reinforcing its own moat and benefiting from broader network effects, liquidity and interoperability

Agora has worked with crypto companies Polygon to help them launch bespoke stablecoins for decentralized finance jects, but van Eck said that Agora expects to work with non-blockchain companies as well moving forward

When Agora launched last summer, the regulatory outlook for stablecoins was still uncertain in the U. , with the company looking abroad for customers

That could change as Congress considers legislation that would regulate the sector, with the Senate passing a bill in June that the House is currently considering

Van Eck said he expects Agora to start serving U

Entities if the legislation is enacted and that the company has been acquiring state money transmitter licenses

Even so, he told Fortune that the company’s focus will continue to be outside the U. , where there is more demand for stablecoins owing to the volatility of local currencies and the need for cross-border payments. “A lot of different financial institutions outside of the U. , I would say, are looking more aggressively and will be quicker to move than some of the companies in the U. ,” van Eck said. “A lot of companies in the U

Are talking it because it’s the topic du jour. ” Un leading stablecoins such as Tether and USDC, Agora is designed to the yield of the dollar- assets backing the stablecoin with its partners. “One of the things we believed in the very beginning was that stablecoins should be run public goods, which to us meant the lion’s of the revenue gets passed to the people who are viding value within this monetary network,” Evans told Fortune

Agora works with State Street and VanEck, the eponymous investment firm run by van Eck’s father, to manage its reserves

Though seed investor Dragonfly participated in the Series A, the vast bulk of the investment comes from Paradigm, the crypto venture firm started by Coinbase cofounder Fred Ehrsam and Sequoia alum Matt Huang

General partner Charlie Noyes described Agora’s duct as a “batteries-included stablecoin” that will allow companies to quickly create their own version without needing to hire 10 engineers to design it

While Noyes acknowledged the aggressive landscape, with companies spending large sums of money and employing more ruthless tactics to drive adoption for their own ducts, he said that Agora’s combination of white-label service, interoperability, and revenue sharing will make it an attractive option to companies exploring the red-hot space. “It’s competitive, but obviously not that many have broken out,” he said

D to clarify Dragonfly’s investment in the Series A

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