FalconX, an institution-facing liquidity aggregator, has announced a $17 million fundraising round including participation from Coinbase Ventures, Accel, and a venture capital firm associated with FMR LLC, the parent company of Fidelity Investments, amidst the COVID-19 slowdown.
It has been reported that FalconX will use the funds to scale its infrastructure, introduce new products, and expand its trade execution engine.
However, FalconX trades as a principal by offering institutions access to both lit pools (exchanges and dark pools), including market makers, miners, and proprietary trading firms, through a single counterparty.
A FalconX representative stated that the firm uses “data science [to] derive fixed, time-guaranteed quotes through market or limit orders over highly dynamic exchange order books” spanning multiple liquidity pools.
The representative added that data science is employed to “compensate for poor fill rates, high slippage, and unreliable infrastructure” to minimize the risk of slippage.
Founded in 2018 by Raghu Yarlagadda and Prabhakar Reddy, FalconX has attracted $7 billion volume since July 2019.
Likewise, the representative also stated that FalconX has attracted more than 100 institutional clients worldwide, “including hedge funds, proprietary trading firms, payment gateways, over-the-counter trading desks, cryptocurrency miners, VC funds, and exchanges.”
Now, the firm operates offices in Malta, The United States, and Bengaluru, India.
It has been analyzed that in spite of having an office in Bengaluru (India), FalconX does not serve clients based in India.
Thus, in response to the Supreme Court’s reversal of the Reserve Bank of India’s ban on financial institutions providing banking services to firms operating with crypto in March, FalconX’s representative stated:
“We are glad to see the government taking an increasingly pro-innovation stance and see the market as an exciting growth opportunity.”