Greetings from TechCrunch’s Fintech coverage! The past week saw a slowdown in news due to a US holiday, yet the fintech sector remained abuzz with updates, including the continued turmoil involving Synapse alongside its ally Evolve Bank, Revolut’s historic earnings, and much more.
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The lead narrative
The data leak at Evolve Bank continues to ripple through the fintech landscape, affecting numerous startups. Yieldstreet confirmed last week that it is among those impacted. In the meantime, Jason Mikula, the mind behind Fintech Business Weekly, disclosed receiving a cease-and-desist from the bank, instructing him not to disseminate dark web-obtained files concerning fintech companies that might have been exposed. Mikula shared with TechCrunch, “My understanding is that several fintechs remained in the dark about the specifics of the breach from Evolve, thus delaying necessary precautionary measures or user notifications.” Additionally, a caucus of senators has rallied, demanding immediate actions from Synapse’s leadership and its fintech and banking partners like Evolve to ensure customers regain access to their funds. The senators also called out company partners and investors, including Andreessen Horowitz (a16z), for their potential roles in the mismanagement of customer assets.
A fresh chapter in the drama reveals a burgeoning conflict between fintech intermediary Synapse and its database service, MongoDB. This dispute poses a threat to independent consultants’ efforts to return funds to millions of app users from Juno to Yotta, who have faced weeks of financial inaccessibility, according to Bloomberg.
Weekly analysis
Revolut announced a monumental leap in its pre-tax profits, reaching $545 million in 2023 and welcoming 12 million new customers over the same period. (Yes, profits. Impressive indeed.) Nikolay Storonsky, Revolut’s leader and co-founder, expressed to CNBC his confidence in acquiring a UK banking license. The digital bank has also alluded to a potential IPO in its yearly summary, highlighting its bolstered financial controls akin to those of publicly traded entities. The anticipation grows for its public debut, especially given its previous valuation at $33 billion following a $800 million funding round in 2021.
Financial round-up
The spotlight is on Indian wealth tech ventures as they attract investor interest, thanks to a burgeoning middle class exploring diverse investment avenues and challenging the status quo of traditional financial advisory for affluent clients, Manish Singh reports. Premji Invest is nearing the final stages of securing a funding round worth between $30 million to $40 million for Dezerv, an app curated for the affluent Indian investor. Simultaneously, Lightspeed Venture Partners is on the verge of leading a funding spree exceeding $20 million in Centricity, a cutting-edge digital wealth management platform. Discover more here.
Additional insights
On the topic of security lapses, TechCrunch’s Devin Coldewey advises readers not to overly concern themselves about the potential exposure of their private ChatGPT interactions following a recent breach in OpenAI’s systems. He remarks, “Although disconcerting, the breach seems to have been relatively minor — it serves as a reminder of the rapidly growing appeal of AI firms as prime targets for online threats. … These AI entities have swiftly emerged as custodians of an immense volume of invaluable data.” Learn more here.
Headline highlights
Trever, a provider of institutional solutions for digital assets, recently unveiled a €2.4 million seed funding achievement, jointly led by TX Ventures (CH) and Market One Capital (LUX), targeting European expansion, as reported by FinTech Global.
MUFG invests $195M in Thailand’s fintech unicorn Ascend Money
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