Dakota Secures $12.5M in Series A Funding

Dakota, a cryptocurrency-native bank, raised $12.5 million in a Series A funding round led by CoinFund, aiming to enhance global reach.

The funding solidifies Dakota’s role in crypto banking, highlighting stablecoins’ impact on business transactions.

The $12.5 million Series A funding round for Dakota was led by CoinFund with participation from 6th Man Ventures, Digital Currency Group, and Triton Ventures. Dakota plans to allocate these funds to expand global operations and accelerate the development of its stablecoin-powered banking accounts. According to CEO Ryan Bozarth, Dakota seeks to enable the movement of funds as efficient as digital information, while ensuring compliance.

“Our goal with Dakota is to bring banking into the internet age — giving businesses the ability to move money as instantly and freely as information travels, without sacrificing security or compliance.” — Ryan Bozarth, CEO, Dakota

CoinFund’s Chief Investment Officer, Alex Felix, emphasized that stablecoins are evolving the business banking sector by merging traditional bank accounts with digital asset technology. This funding will support Dakota’s efforts to transform legacy banking practices through cryptocurrency integration. The platform’s goal is to process $4 billion in transaction volume by 2025, increasing adoption of stablecoin transactions among businesses.

Dakota’s operations primarily utilize stablecoins for transactions, significantly affecting how businesses settle payments worldwide. However, no direct influence on Layer 1 cryptocurrencies such as ETH or BTC has been identified. Dakota acts as a registered money services business, not a licensed bank, focusing on stablecoin usage in corporate finance.

The funding round is part of a broader trend where crypto-native financial firms raise capital to improve liquidity options and adopt blockchain technology. Past events, like funding for firms such as Circle, have demonstrated increases in stablecoin usage for business settlements. The supportive regulatory environment further aids Dakota’s expansion plans, especially with emerging digital asset rules in the US and Europe. Dakota’s success could potentially impact stablecoin markets and settlement transparency, driving innovation in financial transactions across industries.