Payments Startup Flexa Raises $14 Million To Develop Crypto Payment App

by | Apr 12, 2019 | Cryptocurrency, Cryptocurrency News

Flexa| Crypto Payment App | Flexacoin
One of the most crucial conditions for cryptocurrencies to achieve mass adoption is undoubtedly where are the tokens accepted and what you can buy from them. A New York-based payments startup Flexa, has made a $14.1 million worth of effort to ensure just that, purportedly you might be able to buy coffee with bitcon.
Flexa has managed to mince $14.1 million in a private token sale that involved Pantera Capital, 1kx, Nima Capital, Access Ventures and others. Flexacoin, the startup’s token is an ethereum-based ERC-20 token and will be purportedly used by developers and businesses to stake value on Flexa’s network for merchant payment processing.
Tyler Spalding, Flexa co-founder, did not reveal which merchants will accept bitcoin through this app, however, the video tests show users buying Starbucks with it. One thing that Spalding did elaborate on was that the app will be a business-to-business startup, so  Shoppers won’t need to hold or interact with Flexacoins at all.

Flexa co-founder, Trevor Filter stated that such details related to governance and participation are still under development. He added:

“The long-term goal is to give over the network to the merchants. A sort of consortium of their own that allows them to accept crypto.”

Read more: Starbucks To Integrate Bitcoin Payments in Stores As A Part Of Its Collaboration With Bakkt

The rise in private token sales 

It is important to note that over the past six months several companies, including Flexa have had raised funding through a private token sale without equity options. In March, The predictions market startup Numerai minced $11 Million in a similar manner.

CoinDesk interviewed Access Ventures partner TJ Abood, about it and he stated that his firm would have been equally interested in an equity offering. He added that he is satisfied with the current setup as well, as Flexacoin will allow his firm to participate in growing the network.

Involved participants ranging from Access Ventures merchants could purportedly stake Flexacoin to the network and earn token rewards in a model comparable to proof-of-stake systems like Cosmos or Tezos. Flexa also plans to add a custodial crypto wallet app to its network, through which users can spend crypto at point-of-sale with a type of QR code scan, similar to Apple Pay.

Spalding told CoinDesk, adding that the network will launch on May 13:

We wanted the total Flexacoin supply to represent how much money can flow through the system right now. All the participants earn money.”

Abood further told the publishing that the Flexa’s approach to ethereum-compatibility and not complete reliance on the network fits into his investment strategy.  He said:

“We subscribe to the idea of being a user-owner. Any company that we invest in, we immediately look to be a user. Making use of the developer tools and all the system tools that exist to be able to deliver a superior product, that’s what drives us.”

Building bridges 

Spalding further describes that  Flexa’s protocol isn’t building a blockchain-based network, it is simply performing as an “elegant pipe” that processes payments from various cryptocurrency networks, including bitcoin, ethereum, bitcoin cash and litecoin, to the merchant’s own payment processing system for direct bank transfers.

We wanted to build essentially the Stripe for these type of transactions,” Filter added on the matter.

As per Abood, the merchant-oriented structure by Flexa, could entice curious mainstream brands to dip their toes into the crypto ecosystem by offering to accept bitcoin without risk. Spalding added that Flexa will be partnering with exchange platforms for liquidity on the back-end. In addition, the Flexacoin collateral could be used to compensate if there’s an issue with blockchain settlement.

“Flexa plays a critical role in blockchain adoption at-large because it is bridging this digital payments landscape into a brick-and-mortar setting,” Abood said. “It’s opening up the idea of spending cryptocurrency to a much broader audience.”

Filter further described the Flexa protocol as a means for connecting merchant’s traditional infrastructure with a crypto-friendly bridge, instead of depending on debit cards or credit cards. The benefit here is that no personal information exposed the way a credit card payment would have as the process uses crypto wallets. Spalding added.

“I don’t think that blockchains are good for many things. But, they are amazingly powerful for fraud-free payments.”

As of now, Flexa plans on partnering with exchanges and merchants to make custom on-and-off ramps via the Flexa protocol. Support for  various exchange-issued stablecoins and other crypto assets will be added in the near future. Abood concluded.

“A driving source in [mainstream] adoption will be the availability to accept cryptocurrency and that’s a merchant decision.” 

Read more: Pennsylvania’s Ben Franklin Is Tokenizing an Investment Fund, Go Philly Fund

Image source: Stock Photo Secrets

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