Crypto wallet manufacturer Ledger just successfully raised €100 million ($109 million) in its latest funding round, with the majority raised in the first close.
According to Bloomberg, the last funding drive of Ledger puts its valuation at €1.3 billion, which is still the same price as its previous fund-raising in June 2021. The Paris-based firm expects a second close in mid-April and possibly a third due to a high level of investor interest.
Crypto Exchanges’ Demise and Hacks Increase Demand for Hardware Wallets
As large-scale hacks and the collapse of crypto exchanges, such as FTX, shook the industry last year, investors became increasingly concerned about leaving the fates of their assets on online platforms. This resulted in Ledger benefitting from the resulting outflow of funds from centralized exchanges.
Ledger’s crypto wallet products serve as a safer alternative to users who are looking to store their private keys on more secure hardware that’s not vulnerable to hacking.
Hardware Wallets on the Rise as Investors Seek Greater Security
The shift toward greater security mainly contributed to a surge in demand for Ledger’s hardware wallets. Unlike a hot wallet, a cold wallet is the sole responsibility of the user. Although a hardware crypto wallet has its own unique set of vulnerabilities like theft of the hardware itself, it is protected against hacking, which is what the company is capitalizing on.
So far, the crypto wallet maker had its best month for sales in November last year, showing a growth of 200% on a year-on-year basis. However, most of it came from the revenue it generated from Ledger Live, which is its app for buying and selling crypto.
According to Ledger, its platform now stores more than 20% of the world’s cryptocurrencies and 30% of the world’s non-fungible tokens (NFTs).
Expansion Plans
Ledger plans to use the new funding to expand its business by increasing its network of distributors, boosting production, and developing new products. This goes in line with its newly-forged partnerships with luxury brands, including Fendi and Hublot.
It’s worth noting that the company also launched a platform for artists and brands to release their NFTs recently. Additionally, it has unveiled a new version of its hardware wallet designed by Tony Fadell, the co-founder of Nest and the builder of the iPod and iPhone.
New Investors
The major investors in the latest funding drive of Ledger include True Global Ventures, Cité Gestion SPV, Digital Finance Group, and VaynerFund. The mentioned names join existing backers, such as 10T, Cap Horn, Morgan Creek, and Cathay Innovation.
Goldman Sachs Bank Europe SE acted as the sole placement agent of the event. Meanwhile, the Jones Day firm served as a legal advisor during the conduct of the funding.
Revolution of Value
In an interview during the event, Ledger Chief Experience Officer Ian Rogers stated that the Internet revolutionized information and has now given birth to the revolution of value. This includes the rise of NFTs, digital collectibles, digital tickets, digital memberships, and ultimately digital identity.
His statements certainly mirror what is in store for the company’s aggressive expansion as of late.
Final Thoughts
Overall, the successful funding drive of Ledger highlights the growing importance of security in the crypto industry and the increasing demand for hardware wallets as investors seek greater protection for their digital assets. The key advantage of keeping a hardware wallet compared to keeping digital assets on exchanges is that it allows users to store their private keys, which are the passwords that provide access to their blockchain assets, on secure hardware. This makes it less vulnerable to hacks and other security breaches that can happen on online platforms.