Kraken negotiates new capital raise that was valued at $10 billion and if agreed, the new funding will be more than double the company’s $4 billion valuations as we are reading more in our latest crypto news.
Kraken is talking to raise capital in a move that will see the company’s valuation soar to new heights. The US-based crypto exchange is now discussing with Tribe Capital, Fidelity, and General Atlantic to raise more money according to the reports by Bloomberg. As Kraken negotiates, the new funding will double the company’s valuation to around $10 billion as the report cited. The report also noted that there are people that requested anonymity because of the concerns about the secrecy of the deal.
Back in 2019, Kraken raised $13.5 million in a financing round which saw more than 2000 participants buying in. The move pushed the exchange’s valuation above the $4 billion marks.
As we reported recently, Kraken CEO says that whales caused Ethereum’s 50% drop on the exchange when the price crashed from $1600 to $700. The dive prompted numerous debates on whether this was a malfunction on the exchange but the dip was not an error and could have been caused by a whale trader as Jesse Powell noted. ETH’s drop was a part of the huge market decline as BTC alone dropped by around $10,000 which was the biggest dip so far. Ethereum’s price didn’t fall as low as other major exchanges and traded at $1500. Whatever the case is, it was unlikely that Kraken retrospectively canceled the trades conducted on Monday as Powell noted making compensation to the affected traders that could ensue.
It seems that the combination of weak buy support and flash-crash liquidations resulted in a heavy loss for Kraken with BTC falling 22% to less than $45,000 while ETH dropped by 64% to find support at $700. The public reaction on the subreddit r/KrakenSupport saw many traders voice their frustrations and some traders even wanted to take legal action against the exchange with one user claiming to have lost most of their life savings. Kraken users demand compensation after the harsh flash crash localized to the exchange which resulted in leveraged trades that were liquidated amid the sharp retracements that were recorded across crypto markets. Yesterday, we saw the biggest daily candle in the history of bitcoin and ethereum when BTC dropped by almost $10,000 from its high of $57,500 while ETH dropped by $400 from $1940 within the span of 24 hours on Coinbase.
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