Crypto exchange platform Yellow Card has raised $33 million in Series C funding to scale to more countries including Ethiopia, Egypt and Morocco.
Yellow Card was the first cryptocurrency company in Africa to be granted a Virtual Asset Service Provider licence to operate in Botswana in October 2022, allowing Batswana to buy and sell Bitcoin, Ethereum, and USDT.
Founded in 2016,Yellow Card serves as a payment rail in 20 African countries, allowing customers to easily move money across borders while paying a fraction of the fees associated with traditional money transfers.
Yellow Card uses stablecoins, which are usually tied to the value of the US dollar, as a common medium of exchange to enable smoother transactions. When customers deposit local currency with Yellow Card, they receive stablecoins like USDT and USDC, which customers can then use to send money around the world in other currencies using the Yellow Card platform.
“The big shift for us has been our focus on working predominantly with businesses now,” co-founder and CEO Chris Maurice told TechCrunch. “When we started, we targeted the B2C market to serve retail customers. However, we realized that the real users who benefit the most from this technology are businesses.”
Yellow Card served retail customers for the first couple of years after its launch. However, the pivot came when the company, which reached 1 million customers in 2021, according to Maurice, began to notice how incredibly costly it was to handle retail users on the platform. While any crypto customer, regardless of size, must go through sanction screening, KYC, and chain analysis screening, when it came down to volumes, the margins were too thin to make the business sustainable with small retail users. On the other hand, small to large businesses were moving more significant volumes and paying higher gas fees.
As a result, Yellow Card has raised its minimum transaction amounts, a deliberate measure to reduce its broad retail base and grow its appeal to businesses using the platform to manage treasury and access stablecoins.