Juicywayan African fintech leveraging stablecoin technology to power fast and cheap cross-border payments is starting from scratch after processing over $1 billion in transaction volume for thousands of African businesses over the past three years.
The fintech claims to have processed more than 25,000 transactions, generating $1.3 billion in total payment volume (TPV) from 4,000 users. These transactions are powered by stablecoin technology at their core. According to its founders, the fintech amassed these numbers without any publicly available apps or marketing efforts.
Instead, the fintech grew organically, acquiring a similar business with thousands of customers (including Andela, where one of its founders previously worked as an executive) and relying on word-of-mouth referrals.
It’s just now going public after operating in stealth for three years and landing prominent clients such as Bolt, IHS. fintechs such as Piggyvest, Bamboo and Afriex. and energy and logistics company Mocoh S.A.
One type of customer for a cross-border payment platform would be a remittance business that allows users in, say, the US to send money to Nigeria. One such business uses Juicyway (a not-too-fintech name for a fintech) to inject liquidity and decide the prices at which it wants to exchange its funds, in this case dollars, for Nigerian naira. After the conversion, the remittance company can distribute the converted funds to its customers.
Traditional international and cross-border payment platforms have facilitated such a process for years. However, a new wave of platforms powered by stablecoin technology is challenging these conventional methods in developed and emerging markets.
Instead of transferring fiat currencies directly, these platforms use cash deposited in US bank accounts to purchase stable currencies such as USDC or USDT on behalf of users. These stablecoins are then sent to users’ digital wallets, where they can either hold the cryptocurrency or exchange it for their local currency, offering a faster, more flexible and often cheaper alternative.
As executives at Andela, an African-born but global marketplace for technical talent, and Bamboo, one of Africa’s largest retail brokerages, Justin Ziegler and Ife Johnsonrespectively, they saw firsthand the challenges their former employers faced when moving money across borders despite the numerous cross-border solutions on the market.
Ziegler shared that despite Andela’s success and raising hundreds of millions of dollars, getting those funds to the continent for business has proven difficult.
“It didn’t make sense that even though there were a lot of solutions, they didn’t hit the problem in a way that a Bamboo or an Octa would trust,” Johnson (Juicyway CEO) added in an interview.
“On a personal level, I have also felt this disparity. Without access to American banks or platforms like Juicyway, as someone who was born and raised in Africa, I wouldn’t be able to participate in the global economy, you know, as freely as I do right now.”
Those shared frustrations gave way to Juicyway, which the founders say is doing, as Johnson describes, “increasing Africa’s participation in the global economy.” The platform, announcing a pre-seed round of $3 million, enables individuals and businesses to send, receive and process payments globally, supporting fiat currencies and cryptocurrency transactions.
Providing liquidity to businesses
Africa contributes less than 1% of the $5 trillion global forex market, in part because there is no liquidity for currency pairs within Africa. Juicyway provides clients with access to liquidity pools for local and international payments and foreign exchange through its web and mobile applications, as well as APIs covering currencies such as Nigerian Naira, USD, GBP and CAD.
The stablecoin platform displays real-time prices based on what others are willing to pay, fostering a “liquid ecosystem” where competition and transparent pricing drive down the cost of remittances. Market-driven pricing is critical to Juicyway’s operations in Nigeria’s volatile economy. Startup is running Naira rates, The country’s largest rate discovery engine for the naira, with almost 500,000 Twitter followers relying on it to track exchange rates.
In addition, Juicyway offers multi-currency secured accounts for transactions facilitated by partners such as Access Bank in Nigeria for remittance services. Stablecoin infra startup Bridge, recently acquired by Stripe, to move, store and accept stablecoins. and Lead Bank, a major fintech partner bank in the US, to provide virtual dollar accounts for its customers.
While crypto and stablecoin technology offer clear advantages in reducing costs and speeding up settlements, such partnerships are necessary to maintain compliance and manage risk. Therefore, to strengthen compliance, Juicyway has hired Joshua Wasserman, former FDIC bank examiner and Cash App Compliance Lead, and is working with Sumsub on advanced KYC, KYB and KYT processes, enabling transaction limits and tracking anomalies in user behavior to prevent fraud and money laundering, the founders said.
Also, Juicyway understands the partner risk involved as a partner-based financial technology in light of the recent Synapse debacle and is actively in discussions with other banks and payment processing platforms, according to Johnson.
“One way we’ve managed to stay ahead of the curve in navigating complex financial transactions is by clearly separating the roles of lead custodians and payment processors rather than relying on one entity to handle both. However, what I have described right now is not foolproof, so we are also diversifying our banking partners and payment processors in these markets,” said the CEO.
The fintech’s revenue comes from processing and payment fees, with take rates ranging from 0.2% to 10% on some transactions. Moving forward, it will look to generate additional revenue from earning interest on customer balances, Johnson said on the call.
Two months ago, Yellow Card, a startup that leverages stablecoin technology to help more than 30,000 businesses in Africa and beyond payments and fund management, raised $33 million from multiple investors, including BlockChain Capital . It is part of a growing wave of startups, including Conduit, applying stablecoin technology to cross-border payments across Africa and other emerging markets. It is unclear whether other players such as YC-backed Waza and Verto use stablecoins. However, their overlap in cross-border payments puts them in competition for the same market.
While Johnson sees these startups as partners in an evolving cross-border payments ecosystem, he believes Juicyway contrasts with stablecoin orchestration by focusing on meeting customer needs on both supply and demand. “Our unique and largest North Star increases Africans’ access to the global economy and shapes the way we make our decisions,” the executive said. “What that means for us is that we’re very much product and compliance driven, more than we can be financial driven.”
Like other platforms that issue or use stablecoin technology, Juicyway has had to obtain money transmitter licenses to operate—in its case, in the US, UK, Canada, and Nigeria—given the regulatory ambiguity surrounding its issuance and use. of cryptocurrencies and stablecoins worldwide. In the coming years, the 3-year-old fintech may acquire similar licenses in other African countries as it looks to become the platform where Africans and those operating on the continent can easily convert African currencies into local currencies and vice versa.
African seed investor P1 Ventures led the pre-seed round with participation from Platform Ventures, Future Africa, Magic Fund, Microtraction and other angel investors.
