Cryptocurrency is hugely popular in Ukraine. Last year, Ukrainians earned about $400 million from bitcoin investment, making local crypto investors the tenth richest in the world.
Ukrainian tech startup Weld Money decided to offer these investors a cryptocurrency card that allows the use of virtual money in businesses like cafes, grocery stores or cinemas.
Weld Money plans to introduce Ukraine’s first cryptocurrency card this October and enter the European market by the end of the year, the startup’s co-founder Alexey Bobok announced on Aug. 30. It will function as a regular bank card, both virtual and physical.
The card’s owners will first have to connect it to a cryptocurrency trading platform like Binance or Coinbase and add the card to Apple Wallet or Google Pay on their smartphone to use the card.
Weld Money will accept transactions in cryptocurrency and convert virtual money into the customer’s local currency without fees.
Weld Money will exchange cryptocurrencies in Estonia to avoid taxes in Ukraine. Compared to Ukraine, where the cryptocurrency industry remains gray and risky, Estonia has an open and regulated cryptocurrency market.
So far, Weld Money has only developed a basic version of the card, but the company wants to partner with banks to issue Visa or Mastercard cards that users could connect to their crypto wallets.
At first, Weld Money will work with two types of cryptocurrency — Tether and USD Coin, pegged to the U.S. dollar.
The company’s co-founder Irina Lorens told the Kyiv Post that it is easier to launch payments with such stable cryptocurrencies. Still, Weld Money plans to introduce more popular yet volatile cryptocurrencies like Bitcoin, Ethereum and Binance Coin into the system.
Lorens said that Weld Money’s cards would even support digital coins issued by TikTok, YouTube and streaming platform Twitch.
The startup attracted money from the Ukrainian investment fund Concorde Capital, the U.S. Magnus Capital, and Chinese 7 O’Clock Capital.
Faithful to its core concept, the company sold tokens of its digital shares to attract funds.
The company chose to sell tokens because it is faster and easier than traditional fundraising, Lorens said.
“So far we are the only company in Eastern Europe offering a cryptocurrency card, so it is important to capture the maximum share of users in a short time,” she added.
It took only one month for Weld Money to raise funds, which is “almost impossible” in the world of venture capital, Lorens said.
In total, Weld Money has issued 250 million tokens and sold about 13% of them at closed auctions for at least $1.95 million, according to Forbes.
Token owners will be able to withdraw cash from the card at a preferential rate of 1.5% of the sum instead of 3% for ordinary users.
Founded in the summer of 2020 by Bobok, Lorens and Ukrainian entrepreneur Alexey Meretsky, Weld Money now employs 25 people but wants to hire more.
The founders spent their own money to launch the startup.
Bobok and Meretsky also used their contacts from previous jobs in financial technology startups to find partners for Weld Money.
By founding Weld Money, Ukrainian techies stepped into a promising market. Ukraine is a huge market where people are ready to adopt cryptocurrency and test the product.
Weld Money’s international competitors like Coinbase Pay, Wirex and Binance Pay — all valued at billions of dollars — are unavailable in Ukraine due to difficulties with regulation and banking.
