US broker Alpaca announced a $135 million venture funding led by Peak XV, with participation by Elefund, Opera Tech Ventures, the venture capital arm of BNP Paribas Group, and Unbound. Alpaca isn’t your conventional broker but more of an API broker, enabling fintechs to piggy back off its infrastructure for trading. It has AI driven investing in its sights, but one group that already relies heavily on Alpaca is the largest synthetic tokenized stock issuers, Backed (xStocks), Ondo Global Markets and Robinhood, plus the recently launched Binance bStocks. Alpaca provides custody for the stocks that underpin $1.5 billion in tokens.
The latest funding round comes on the heels of a January Series D funding of $150 million. Since then the company has expanded, acquiring WealthKernel, which provides a similar API service in Europe, and Zincmoney in India.
What’s even more interesting is the $300 million in debt funding that Alpaca simultaneously raised, mainly from Kraken parent Payward and BMO. Payward owns Backed, so the group is dependent on Alpaca, but is now also a creditor, a position that brings visibility into Alpaca’s operations. Depending on the loan terms, it is also a potential path to an equity stake. One of the questions is what does Alpaca need the money for?
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