Laszlo Szabo is not one to get carried away. Not his style. But at the end of November, when the markets are not far from capitulation because of the fall of FTX, the co-founder of Kiln can't help but put on a broad smile. Less than six months after an initial fundraising round of €4.7 million, the French start-up has just raised a further €17 million in a Series A.
In addition to the initial investors (Alven, Blue Yard Capital, etc), other industry heavyweights such as US exchange platform Kraken have entered the capital of the young start-up created in 2020.
In addition to the initial investors (Alven, Blue Yard Capital, etc), other heavyweights in the sector such as the American exchange platform Kraken have entered the capital of the young start-up created in 2020.
Kiln, whose valuation is not public, specialises in the "staking" of cryptocurrencies in Proof-of-Stake (PoS). The largest is Ethereum, which switched to PoS in September with The Merge.
Staking is a remunerated activity that involves "immobilising" crypto-assets in a smart contract to help secure the protocol. The more ethers you stake, the more you are paid in ethers.
In two years, Kiln has become a major player in this industry by enabling companies to stake as well. For the moment, you need to "stake" at least the equivalent of 32 ethers (€35,000) to be a Kiln customer, but the company is working on a product that will enable its professional customers like Ledger, and other wallets, exchanges, and custodians to offer live staking on any amount brings.
The Paris-based start-up, which employs nearly 40 people in 5 countries (France, Holland, the UK, Spain and Italy), although the majority are in Paris, currently manages just over $600 million in cryptos. And the figures are growing all the time.
Lending on the wane Kiln is benefiting in particular from the setbacks of a large number of lending players. After the collapse of Terra (Luna) in the spring, several players like Celsius went bankrupt, and the collapse of FTX has accelerated the phenomenon even further. "Lending is simpler to set up, but we can also see that it is much less secure than lending," explains Laszlo Szabo, co-founder and CEO of Kiln.
In staking, the counterparty is Ethereum whereas for lending, it is the platforms themselves with the consequences we know 😅.
With its fundraising, Kiln aims to expand in Europe and the United States, where some of the world's biggest asset managers are increasingly interested in cryptos. American giant Fidelity has launched a product enabling its tens of millions of individual customers to be able to put cryptos into their retirement savings plans. "Things are moving fast in the US," confirms Laszlo Szabo.
Kiln is not the only company to offer staking to businesses either. Several other players, such as the Canadian Figment, have managed to grow strongly. Figment is valued at over a billion dollars.
