KuCoin Ventures leads stablecoin issuer CNHC's $10m funding round

KuCoin Ventures leads stablecoin issuer CNHC's $10m funding round

FILE PHOTO: Representations of the Ripple, Bitcoin, Etherum and Litecoin virtual currencies are seen on a PC motherboard in this illustration picture, February 14, 2018. REUTERS/Dado Ruvic/File Photo

CNHC, which issues stablecoins to facilitate cross-border payments, has raised $10 million in a funding round led by KuCoin Ventures, the venture capital arm of crypto exchange KuCoin.

The round joined by IDG Capital and Circle Ventures will help the company to expand the use cases of its stablecoin, according to a company release on Wednesday. “CNHC is expanding its business not only in cross-border settlement but also in other scenarios. We want to make ourselves part of the foundation and infrastructure of Hong Kong’s Web3 ecosystem,” said Joy Cham, co-founder of CNHC.

CNHC Group issues an offshore stablecoin called CNHC which is pegged to the Chinese yuan. The stablecoin is mainly used by local exporters to facilitate cross-border payments in countries with underdeveloped banking systems. Currently, the firm processes an average transaction volume of $40-50 million per month.

The firm added in the release that it is currently moving its headquarters to Hong Kong from Singapore thanks to the city’s crypto-friendly policies. The city’s new licensing regime for centralised virtual asset trading platforms for non-security tokens is set to come into effect on June 1.  

The lead investor KuCoin Ventures invested in over 30 blockchain firms last year, according to the firm’s 2022 annual review published in January. 

“KuCoin Ventures is a thesis-driven venture fund focusing on early-stage projects. We have our visions and values for the Web 3 world and we select the projects based on those theses that reflect our understanding of the crypto industry. For Instance, we have a thesis on better access to crypto, based on which we would aggressively look for those projects which can lower the barrier of onboarding the next billion users,” Justin Chou, chief investment officer of KuCoin and lead at KuCoin Ventures, told Dealstreetasia in an interview earlier. 

When asked if the firm plans to ramp up its investment target this year, Chou said the firm does not seek to increase the number of investments.

“Part of the deals are thesis-driven investments and the other parts are strategic investments which have the synergy with the exchange business itself. This year,  we still want to follow the thesis-driven philosophy. We won’t rush to increase the number of investments without really understanding the fundamentals of the different segments we are researching.  Moreover, we would want to lead or co-lead the projects as our thesis matures and the teams are more experienced,” he added. 

VC investments in the global crypto sector for the entire 2022 stood at $36.6 billion, up 20% from $30.5 billion in the previous year thanks to strong fundraising in the first half of the year, according to a report published by Cointelegraph.

Edited by: Pramod Mathew

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