Zap, a Visa-partnered Bitcoin payments startup, has quietly raised $3.5 million in a seed round closed in April this year.
Reported by Forbes, the funding round was led by Green Oaks Capital and was joined by Morgan Creek and Bitcoin proponent Anthony Pompliano. Prior to the funding round, the startup was bootstrapped by its founder Jack Mallers’ family.
Zap is one of the many Bitcoin payments startups in the market, but it stands out in the crowd due to its usage of Lightning Network, which will assure the transaction settlements instantly instead of taking the usual 10 minutes block confirmation time by the Bitcoin mainnet.
This will also significantly reduce transaction fees even during network congestions as the confirmations are being made on a sidechain.
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Explaining the client base of Zap, Mallers told the publication: “One of the early use cases for us is content creators. Journalists or video game streamers or adult film actors and actresses, put up profiles backed by our infrastructure, and anyone in the world can tip them.”
“Our users today, don’t ever know we’re using bitcoin when they’re using dollars. It’s just kind of like we’ve melted it in the background…I think tens of millions of people will be using this stuff in the next few years, and that just takes a little bit of capital.”
Eyes on scaling the business
Following the new funding round, Mallers is aiming to scale the business. He also admitted that though he is an expert on the technology and the Bitcoin market, he does not have any experience in scaling a business and thus will need the involvement of the investors.
The Bitcoin startup grabbed headlines last month when it was admitted to Visa’s Fast Track Program, prompting it to launch a Visa-labeled card in a year. According to the founder, one of the products is already in pipeline for launch in the coming months.