Klarnageddon begins as Klarna loses 85% of valuation w fresh funding 🤯; More generous but still nuts - FTX to buy BlockFi at 95% discount 👀; Open Banking wars continue: GoCardless buys Nordigen 💸

Good Morning FinTech, 4 July

Good morning Everyone,

Happy Monday & Happy Independence Day to all my American friends and readers!🇺🇸Today’s issue is super hot and something you definitely cannot miss. We’re looking at the beginning of Klarnageddon as Klarna loses 85% of valuation with fresh funding (it might not be the last one), FTX being more generous as it will buy BlockFi at a 95% discount (still crazy!), and Open Banking wars continuing as GoCardless buys Nordigen (and a reminder why Open Banking is the Next BIG Thing in FinTech since Plastic). So without further ado, let’s jump straight into the good stuff:

Klarnageddon begins as Klarna will lose 85% of its valuation with the fresh funding 🤯

The (super sad) news 📰 Swedish Buy Now, Pay Later darling Klarna is closing in on a funding round that would see the BNPL giant's valuation slashed from $45.6 billion last year to just $6.5 billion, according to the Wall Street Journal. That’s an 85% correction! 😮

More on this 👉 Klarna is reportedly working to raise about $650M, most of it from existing investors led by Sequoia Capital, as per WSJ. Just two weeks ago, I’ve written about Klarna’s attempt to raise a $15B price tag, which clearly didn’t materialize.

This graph below aged so fast it’s mindblowing… 😬

Everything becomes even crazier when you realize that back in February, Klarna was rumored to be weighing a raise at a valuation of up to $60 billion. I’m not making this up!

This clearly marks the beginning of Klarnageddon. It won’t be pretty, and it will spread beyond just Klarna and BNPL providers. Here’s the takeaway: