Last week OpenFX emerged from stealth with a $23m funding round led by Accel. The startup’s goal is for its infrastructure to enable 24/7 instant cross border payments and claims to have achieved $10 billion in annualized cross-border payment volume already. The annualized caveat means it hasn’t yet reached that milestone. What was most notable is that despite using stablecoins for payments, the company barely mentions them in its launch or on its website.
This approach reflects blockchain’s maturation – the technology gains true traction when it becomes invisible backend infrastructure. Payment providers prioritize speed, security, and cost over underlying technology.
On the OpenFX website we found only one graphic that shows the conversion of a stablecoin to dollars. Two of its backers only invest in crypto-related firms – Castle Island Ventures and Hash3. Additionally, its founder and CEO is Prabhakar Reddy, who was previously co-founder of crypto prime broker FalconX.
It’s not surprising it raised $23 million given the ticket sizes for other stablecoin infrastructure startups. Stripe acquired Bridge last year for $1.1 billion and Visa invested in BVNK at a valuation of about $625 million, based on our calculations.
With this substantial funding secured, OpenFX is focusing on rapid geographic expansion. OpenFX is still at an early stage and so far transacts in 26 countries and seven foreign exchange (FX) pairs, with plans to expand to 15 of the G20 FX pairs and around 40 countries by the end of 2025.
FX as the business model for stablecoin infrastructure
Payment providers and remittance firms are looking for a few things from stablecoin infrastructure firms. One is a strong and secure software infrastructure, and the other is good on and off ramp relationships. Off-ramps typically involve connectivity to banking networks as well as foreign exchange. Sometimes they are via local crypto exchanges.
These on and off-ramp services can be broken down into distinct functions. That includes converting between dollars and dollar stablecoins; the FX conversion between dollars and the currencies at either end of the transaction; and then integrating with banks or other institutions at the source and destination.
Judging by the company’s name, its business model may be focused more on the foreign exchange angle. That’s a smart move, because in many payment corridors FX is by far the largest slice of cross border payments costs, as shown in the graphic below from a couple of years ago.
