OSL Secures Capital Top-Up From Fidelity; Shares Fall But Still Trade At Steep Valuations
The provider of stablecoin trading and payment services has raised $200 million through a share sale to Fidelity
image credit: Bamboo Works
Key Takeaways:
- OSL has raised $200 million by selling shares to Fidelity, just six months after securing $300 million in the largest publicly disclosed share sale by a crypto firm at that time
- The Hong Kong-based company is building up stablecoin services as demand for such digital assets grows exponentially
In the Wild West of digital assets, stability is fast emerging as a precious commodity. OSL Group Ltd. (0863.HK) realizes that and is looking to sell investors on its ability to prosper by offering just that resource.
Last Thursday, the provider of stablecoin trading and payment services said it raised $200 million to fund its expansion, including acquisitions. The money came from asset management giant Fidelity, which already held a sizable stake in OSL before the latest fundraising, according to Tracxn. The move comes just six months after OSL secured an even greater $300 million in what was the largest publicly disclosed equity sale by a crypto sector company at that time.
The aggressive, back-to-back fundraisings point to a high-stakes land grab in one of finance’s fastest-evolving frontiers. Demand for stablecoins, digital tokens pegged to steady real-world assets like the U.S. dollar, is growing exponentially as they become critical plumbing for the digital asset economy on two fronts.
Firstly, for the likes of traders and investors, converting volatile cryptocurrencies into dollar-backed tokens like stablecoins is essential in managing risks and liquidity. Institutional adoption of stablecoins is increasing, providing a powerful force for their growth. More than 80% of institutions across the globe are using or exploring stablecoins, according to a survey by EY and Coinbase published in March last year.
Secondly, stablecoins are becoming a vital tool for cross-border payments and remittances. By leveraging blockchain technology, stablecoins can facilitate cross-border transactions that are faster and cheaper than the traditional route through banking systems, particularly in emerging markets. So, it’s no wonder a growing number of businesses are accepting stablecoins, which means they are emerging as an increasingly popular real-world currency.
At the regulatory level, authorities are also increasingly providing growing clarity for crypto-related businesses by establishing licensing requirements. In 2020, OSL became the first firm to receive a license from Hong Kong’s Securities and Futures Commission to …
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