From $1.5B to $0 in 4 months, or a wild story of Wyre 🤯; The hidden factor of NFT adoption 👀; Trade Republic making moves 💸

FinTech is Eating the World, 9 January

Hey Everyone,

Happy Monday! I hope you had some time to relax over the weekend as we’re starting the new week with some hot stuff ❤️‍🔥 Today we’re looking at the wild story of Wyre, or how it went from $1.5 billion valuation to $0 in just 4 months (& what doesn’t add up there), the hidden factor of NFT adoption (you might be surprised!), and Trade Republic which is making some moves (will it be enough to stand out?). Let’s jump straight into the awesome stuff:

From $1.5 billion to $0 in 4 months, or a wild story of Wyre 🤯

The news 🗞 Last week, Axios reported that crypto payments firm Wyre is shutting down amid layoffs. In an update, Wyre said its operations would continue.

This mismatch alone makes you want to take a closer look at Wyre. So let’s do just that.

The USP 🥊 Founded in 2013, Wyre has raised a total of $29 million across 9 funding rounds from investors including Pantera Capital, Tim Draper, and Digital Currency Group. Wyre's core product is offering payment APIs for crypto via cards, Apple Pay, and bank transfers. In other words, it’s a crypto on-ramp like MoonPay or Ramp.

The timeline 📉 In hindsight, there were a ton of red flags 🚩 Here are the most important developments in the Wyre story:

• Wyre first made headlines in April last year when one-click checkout company Bolt announced it was buying the company in a $1.5 billion deal. It marked the crypto industry’s largest-ever acquisition. The fact that the company with “only” $29M raised was intended to be acquired for $1.5B is just nuts now.

• In September 2022, the deal was canceled, and the companies “have mutually agreed to continue their partnership as independent businesses”. In other words, Wyre was overpriced with questionable unit economics while Bolt itself probably wasn’t able to afford it given their own inflated valuation, misreported numbers, and rising doubts about the health of the one-click-checkout business model.

• Shortly after the failed acquisition, one of Wyre’s co-founders, Michael Dunworth cashed out 12.5% of his holdings. This was arguably the first major warning.

• Last week, Wyre laid off 75 employees amid reports the firm was planning to shut down. In an update, Wyre said its operations would continue. "Our operations continue and we will share information with the community as it is available," it noted.

• The final nail into Wyre’s coffin was the announcement over the weekend that it's limiting withdrawals at 90%. Unsurprisingly, this left users rushing to gradually pull most of their funds from the site.

• And the icing on the cake - it was also revealed that Ioannis Giannaros is making a switch from CEO to executive chairman, while chief risk officer and chief compliance officer Stephen Cheng is stepping up to become chief executive on an interim basis. When your CCO becomes CEO, this means that there’s a high chance you’re in trouble.

But there’s more. And some things just don’t add up… Here’s something spicy: