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BFD Expert Voices - Private Credit

BFD Expert Voices

💨 Gensler under pressure

Photo illustration of Gary Gensler in front of a calendar page with drawn circles and X's.

Photo illustration: Shoshana Gordon/Axios. Photo: Win McNamee/Getty Images

Crypto venture funding plummets in Q3

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SEC chair Gary Gensler's biggest defenders are seeing the writing on the wall.

"SEC Chair Gensler should resign," former SEC attorney John Reed Stark wrote yesterday on X.

Why it matters: Unlike all the comments from the crypto crowd on social media, Stark's long been a vocal defender of Gensler and the SEC's approach to crypto.

Flashback: In June 2023 Stark wrote on X, "My take is that the SEC is spot-on with their crypto-related enforcement efforts."

He added that "no matter what the carnival barkers promise," crypto trading platforms are unquestionably "high-risk, perilous and inherently unsafe."

The big picture: There's no evidence to suggest that Stark — who spent 11 years as chief of the SEC Office of Internet Enforcement — has changed his view on crypto.

Instead, his call for Gensler's resignation is his acknowledgment of a new post-election reality.

Zoom in: "The people have spoken and should be respected," Stark wrote yesterday. "The SEC's crypto-enforcement wave (which has been extraordinarily successful in the Courts) should stop — and the SEC should instead refer crypto-matters out to other law enforcement and regulatory agencies."

He predicted the SEC would soon "pause" crypto-enforcement and rule-making actions, part of a step back to study the technological aspects of digital assets in terms of how they may fit a new regulatory scheme.

"And that's fair, given the election results," he added. "SEC Chair Gary Gensler should respect the landslide victory of Big Crypto and the SEC staff should not partake in any sort of deep state subversion. The people have spoken, it's crypto-caveat emptor going forward ... and let the chips fall where they may."

1 big thing: 💨 Gensler under pressure

Venture funding to crypto startups fell sharply in the third quarter, according to Pitchbook data.

Why it's the BFD: Despite venture dealmaking recovering in the broader fintech ecosystem, the crypto sector lagged behind its peers. 

By the numbers: The number of crypto deals during the period fell 25.3% quarter over quarter to 392, while the total value of those deals fell 31.1% to $1.7 billion, Pitchbook said in its Q3 Crypto Report.

Yes, but: Valuations for crypto startups during the first three quarters of 2024 are up across the board.

According to Pitchbook, the median pre-money valuation for seed-stage startups was $18.5 million, up 55.8% from full-year 2023 numbers.

At the early stage, the median pre-money valuation was $60.8 million, up 154.8% during the same period. 

The late-stage median pre-money valuation was $60.0 million, up 26.3% from full-year 2023.

Between the lines: The median deal size was up in the earlier stages but declined for late-stage startups.

For the first three quarters of 2024, the median seed deal was $3.0 million, up 36.4% from 2024, while the median seed-stage deal was $4.8 million, up 33.3%.

The median late-stage deal fell 6.2%, to $6.0 million, during the period.

2. The BFD: Crypto venture funding plummets in Q3

🧑‍💻 A profile of Klarna CEO Seb Siemiatkowski as the company prepares for IPO. (FT)

🔎 The CFPB took steps to place Google under formal federal supervision. (WaPo)

📈 Sezzle and Expensify shares jumped after earnings, spurring a rally in the FinTech IPO Index. (PYMNTS)

🇬🇧 The U.K. government announced reforms to boost growth in the financial sector. (Fintech Futures)

3. Credit score

Go deeper into our full database with the Axios Pro Deals Tracker.

• Just, a French retail checkout solution, raised €8m in seed funding. Backed led and was joined by Daphni, Otium and FJ Labs. Go deeper

• Tangible, a London provider of financing software for climate-focused hardware developers, raised £4m from Future Positive Capital, Hardware Club VC, MMC, Blackwood and Systemiq. Go deeper

• Osyte, a Seattle-based multi-asset portfolio management software provider, raised a $4m seed led by Moneta Ventures. Six Thirty Ventures, Altari Ventures, Tacoma Venture Fund and Sigmas Group Family Office also participated. Go deeper

• BVNK, a stablecoin startup backed by Tiger Global, is in talks to raise $50m. Go deeper

• STG Partners invested in TaxCalc, a U.K. tax and accounts compliance provider and practice management software. taxcalc.com

• Amundi (PAR: AMUN) acquired Aixigo, a German wealth management software maker, for €149m. Aixigo was backed by Fronttrail Equity Partners.  Go deeper

• Portal Ventures, a pre-seed crypto firm, raised $75m for its second fund. Go deeper

4. Deals!

• Truelayer, a London-based open banking startup, has laid off roughly a quarter of its workforce. Go deeper

5. It's Personnel

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November 15, 2024

1 big thing: 💨 Gensler under pressure