Revolut's strategic push into private banking targeting high-net-worth clients ๐ค๐ฆ; Standard Chartered expands digital asset services in the EU ๐ช๐บ๐ช; Groww's $8B IPO bid ๐ฎ๐ณ๐
You're missing out big time... Weekly Recap ๐
๐ Hey, Linas here! Welcome back to a ๐ weekly free edition ๐ of my daily newsletter. Each day I focus on 3 stories that are making a difference in the financial technology space. Coupled with things worth watching & most important money movements, itโs the only newsletter you need for all things when Finance meets Tech.
If youโre not a subscriber, hereโs what you missed this week:
The ultimate list of resources for building and scaling billion-dollar companies ๐ฆ [1,500+ pages of knowledge, data, and advice to launch & scale your next unicorn startup in 2025]
AI 100: Top Artificial Intelligence Startups of 2024 ๐ค๐ธ [these companies raised $28B already. Find whose backing them, unlock their exclusive pitch decks & learn from the best]
Global 6,200+ Investor Database to Fast-Track Your Funding in 2025 ๐ธ [shorten your fundraising time, find your perfect investors, and close rounds faster]
230+ Non-VC Funding Sources for Startup Founders & Entrepreneurs ๐ธ [shatter the funding barriers and unlock more than 200 non-venture capital resources to scale faster & farther]
Wall Street giant JPMorgan continues to show strong momentum despite macro headwinds ๐ช๐ฆ [breaking down their Q4 2024 financials, what they mean & whether JPM is worth your time and money in 2025 + bonus reads on JPM inside]
Citi's transformation shows promise, but uncertainty remains ๐๐ฆ [unpacking their latest numbers what they mean, whatโs next & whether Citi is worth your time and money in 2025]
Goldman's Q4 2024: Wall St. behemoth's reclaiming its crown thru strategic evolution & market leadership ๐ค๐ธ [breaking down their latest numbers, why they matter & whether Goldman is worth your time and money this year]
Wells Fargoโs Q4 2024: Fed asset cap overshadows strong fee income growth and cost controls ๐ฌ๐ [breaking down the key numbers, what they mean & whatโs next for Wells Fargo]
Robinhood's $45 million SEC settlement highlights growing regulatory scrutiny of digital brokers ๐๐ธ [what itโs all about & what it tells us + bonus deep dives into Robinhood & co]
Italian banking giant Intesa Sanpaolo makes historic $1M Bitcoin investment ๐ณ๐ฆ [what it tells us & whatโs next]
The Ultimate List of Resources to Promote Your Startup for FREE ๐ [380+ free places to post your project or startup to maximize exposure & accelerate growth ]
As for today, here are the 3 incredible FinTech stories that were transforming the world of financial technology as we know it. This was yet another insane week in the financial technology space space so make sure to check all the above stories.
Revolut makes a strategic push into private banking, targeting high-net-worth clients ๐ค๐ฆ
The news ๐๏ธ Revolut, the global financial Super App recently valued at $45 billion, is making a strategic expansion into private banking services, marking a notable evolution in its business model.
The UK-based FinTech giant is actively recruiting key positions to build out its private banking division, specifically targeting individuals with liquid assets exceeding $1 million.
Letโs take a look at this and see why it matters.
More on this ๐ The company's job listings reveal plans for a comprehensive private banking offering, including roles for a Head of Relationship Management, Legal Counsel, and Compliance Manager. These positions will focus on developing and managing investment products, private banking services, and wealth management solutions for high-net-worth individuals (HNWIs).
This move represents a significant departure from Revolut's traditional focus on retail banking and positions the company in direct competition with established private banking institutions like UBS UBS 0.00%โ and Morgan Stanley MS 0.00%โ, as well as newer fintech players such as Alpian and Sidekick.
The initiative comes at a time when Revolut has achieved substantial growth, reaching 50 million customers globally, with 20% based in its home market of the United Kingdom.
Zoom out ๐ The expansion into private banking aligns with Revolut's broader strategy of becoming a comprehensive financial platform. The company has already demonstrated its commitment to growth through various initiatives, including the introduction of new anti-fraud security measures for cryptocurrency customers, the expansion of its trading services in the UK, and the extension of its cryptocurrency exchange into European markets.
โ๏ธ THE TAKEAWAY
Whatโs next? ๐ค First and foremost, this move represents a potential shift in how digital banks approach wealth management. By bridging the gap between traditional private banking and digital-first services, Revolut could create a new hybrid model that appeals to next-generation wealthy clients who prefer digital interfaces but still want personalized service. Furthermore, the move may also accelerate the transformation of private banking services, forcing traditional institutions to modernize their offerings more quickly. This could thus lead to increased competition and innovation in the private banking sector, potentially benefiting clients through improved service quality and reduced costs. Looking ahead, one thing is clear - we can expect Revolut to leverage its technological expertise to differentiate its private banking services. The company's track record in areas like cryptocurrency trading and its planned AI-powered financial assistant could provide unique advantages in serving wealthy clients who seek both traditional wealth management services and exposure to new investment opportunities. Obviously, the success of this venture will largely depend on Revolut's ability to build trust with high-net-worth individuals who traditionally favor established private banks.
ICYMI:
Standard Chartered expands digital asset services in the EU ๐ช๐บ๐ช
The news ๐๏ธ Standard Chartered has taken another step in its global digital asset strategy by establishing a new entity in Luxembourg to provide cryptocurrency custody services across the European Union.
This development comes as the bank positions itself to operate under the EU's Markets in Crypto Assets (MiCA) Regulation framework.
Letโs take a quick look at this and see why it matters.
More on this ๐ The Luxembourg entity, led by newly appointed CEO Laurent Marochini, former head of innovation at Sociรฉtรฉ Gรฉnรฉrale, will initially offer custody services for Bitcoin (BTC) and Ethereum (ETH), with plans to expand to additional digital assets later in 2025.
We must note that the bank has clarified that while custody services will be available, trading services are not currently planned for the Luxembourg operation.
This expansion follows Standard Chartered's September 2024 launch of digital asset custody services in the United Arab Emirates, demonstrating the bank's methodical approach to building its global digital asset infrastructure.
Standard Chartered is unique in providing custody services directly, backed by significant risk capital and its own balance sheet.
โ๏ธ THE TAKEAWAY
Whatโs next? ๐ค First and foremost, Standard Chartered's move represents a crucial shift in how traditional banking institutions are approaching digital assets. By establishing regulated custody services in major financial centers, the bank is creating a bridge between traditional finance and the digital asset ecosystem, potentially accelerating institutional adoption and thus making sure itโs at the forefront of Finance 2.0. When it comes to Luxembourg as an EU hub, this seems to be a strategic strategic move given its reputation for balanced financial regulation and its position as a key European financial center. This could potentially set a precedent for other global banks considering similar expansions under the MiCA framework. Looking ahead, we can expect several things:
Other major banks will likely follow suit with similar regulated custody offerings, particularly in regions with clear regulatory frameworks.
The scope of services will probably expand beyond custody to include trading and other digital asset services as regulatory clarity increases and institutional demand grows.
Standard Chartered's goal to secure $200 billion in net new money by 2030 suggests that digital assets will play an increasingly important role in traditional banking services.
This move also highlights the growing importance of regulatory compliance in the digital asset space, with banks like Standard Chartered helping to establish standards for institutional-grade digital asset services. Gradually then suddenly.
ICYMI: Crypto investment products saw unprecedented growth in 2024, setting the stage for market evolution ๐๐ธ [a quick look at historic crypto numbers & why they matter + bonus dives & reads on crypto et al.]
Bitcoin mining firms stockpile crypto amid industry transformation โ๏ธ๐ช [what this tells us & what can we expect next]
Corporate Bitcoin adoption is gaining momentum ๐๐ช [why it matters & whatโs next]
Groww's $8B IPO bid marks a major milestone for India's digital trading landscape ๐ฎ๐ณ๐
The news ๐๏ธ India's largest retail stockbroker Groww is preparing for a landmark initial public offering (IPO) that could value the company between $6-8 billion, marking a significant milestone in India's evolving fintech landscape.
The Bengaluru-based company, which plans to list within the next 10-12 months, aims to raise approximately $600-800 million through the offering.
Letโs take a quick look at this.
More on this ๐ The planned valuation represents a considerable jump from Groww's last private valuation of $3 billion in October 2021, reflecting the company's robust growth trajectory. With 13.2 million active users, Groww has established itself as the market leader in India's retail trading space, surpassing traditional player Zerodha's 8.1 million users.
More importantly, the company continues to demonstrate strong momentum, adding between 325,000 to 550,000 new users monthly. Nice ๐
Zoom out ๐ In preparation for the IPO, Groww has already completed several strategic moves, including relocating its parent entity from the US to India. While necessary for the listing, this transition resulted in a one-time tax payment of Rs 1,340 crore ($160M) to the US government.
Despite this expense causing a net loss in FY24, the company's revenue grew significantly to Rs 3,145 crore from Rs 1,435 crore in the previous year. Solid!
However, we must note that Groww faces notable challenges as it approaches its public debut. Recent regulatory changes by SEBI targeting excessive speculation in derivatives trading could significantly impact revenue streams.
The regulator has doubled futures and options (F&O) contract sizes and implemented stricter trading rules, prompting concerns about potential revenue impacts across the industry.
โ๏ธ THE TAKEAWAY
Whatโs next? ๐ค Looking ahead, Groww's IPO could set several important precedents for India's FinTech sector. As the first digital trading platform to go public in India, its performance will likely influence the trajectory of other FinTech IPOs in the pipeline. The company's listing comes amid a broader surge in India's tech IPO landscape, with over 20 startups expected to pursue public listings in 2025. Looking at the bigger picture, the timing of Groww's IPO coincides with a transformative period in India's financial markets. The country's market capitalization has doubled to $5.3 trillion in recent years, while daily trading volumes have tripled to $15 billion. This growth and India's supportive policy environment and growing domestic capital base suggest favorable conditions for FinTech listings. Will be an interesting watch for sure ๐ฟ
๐ What else Iโm watching
Klarna in Talks to Sell US Loans Ahead of IPO ๐ธ Klarna is reportedly in discussions with several banks, including Citigroup, RBC, Nordea, and Sociรฉtรฉ Gรฉnรฉrale, to sell a portfolio of its US "Pay in 4" installment loans. This move aims to free up capital for growth and satisfy investors ahead of its planned IPO later this year. Previously, Klarna sold its UK loans book to hedge fund Elliot Advisors, freeing up around ยฃ30 billion. The company submitted a draft Registration Statement to the SEC for its US IPO, which could value Klarna at over $20 billion.
eToro Files for US IPO, Potentially Valued at Over $5 Billion ๐ eToro has confidentially filed for a US initial public offering (IPO) with the Securities and Exchange Commission (SEC), according to the Financial Times. The online investment platform, founded in 2007, allows users to trade various assets, including fractional equities and cryptocurrencies. This is eToro's second attempt at going public, following a canceled $10.4 billion SPAC deal in 2022. In 2023, eToro raised $250 million at a $3.5 billion valuation. Recently, eToro's US business settled SEC charges, agreeing to pay $1.5 million and halt trading in most crypto assets, except for Bitcoin, Bitcoin Cash, and Ether.
India Postpones UPI Market Share Cap Deadline by Two Years ๐ The National Payments Corporation of India (NPCI) has delayed the implementation of a 30% market share cap for third-party app providers using the Unified Payments Interface (UPI) by two years, pushing the deadline from the end of 2024 to the end of 2026. This move benefits major players like Google Pay and PhonePe, which together handle over 85% of UPI transactions. The delay, the second of its kind, comes as WhatsApp has been approved to roll out its P2P payments service to all 500 million Indian users, increasing competition in the market.
๐ธ Following the Money
MoonPay has acquired Helio, Solanaโs premiere crypto payment processor.
LemFi, a financial services platform for immigrant communities, has raised $53M in a Series B funding round led by Highland Capital.
Ebury has agreed to acquire ArcaPay, a Lithuania-based specialist provider of B2B cross-border payment solutions.
๐ Thatโs it for today! Thank you for reading and have a relaxing Sunday! And if you enjoyed this newsletter, invite your friends and colleagues to sign up:
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