Stablecoin-Powered Neobank KAST Raises $10M in Seed Round
Peak XV Partners and HongShan Capital—the former Sequoia affiliates now operating independently—have co-led a $10 million seed investment in KAST, a next-generation neobank leveraging stablecoins for global financial access.
Bridging Crypto and Traditional Finance
KAST operates as a dollar-denominated digital banking platform, enabling users to:
- Hold and spend stablecoins via conventional payment channels
- Utilize crypto-linked credit cards accepted by mainstream merchants
- Bypass traditional banking networks for cross-border transactions
The startup specifically targets emerging markets where USD access is limited and remittance fees remain prohibitively high. While regulatory restrictions prevent operations in India and China, KAST serves offshore workers from these regions.
Why Stablecoins? The Emerging Market Opportunity
Co-founder Raagulan Pathy (ex-Circle APAC) explains:
“Existing banking infrastructure fails to address cross-border payment friction. We’re rebuilding financial rails using stablecoins as the foundational layer.”
Market trends support this approach:
- 20M+ monthly stablecoin users globally, with emerging markets driving adoption
- Major players like Stripe ($1.1B Bridge acquisition) and PayPal (PYUSD launch) entering the space
- Tether currently dominates with ~75% market share
Competitive Differentiation
KAST positions itself against both:
- Crypto-native platforms lacking traditional banking integrations
- Legacy fintechs retrofitting crypto capabilities
Co-founder Daniel Bertoli (Quona Capital alum) notes:
“Future digital banks will be natively global with stablecoin DNA—not bolt-on features.”
Investor Confidence and Growth Trajectory
The round saw participation from DST Global and Goodwater Capital. While KAST hasn’t disclosed valuation metrics, the company reports exceeding growth targets within four months of launch.
Upcoming initiatives include:
- Savings products with stablecoin yields
- Expanded remittance corridors
- Infrastructure enhancements for digital nomads
Alex Svanevik (Nansen.ai CEO, early investor) highlights:
“Stablecoins eliminate weeks-long international transfers, offering instant settlements at near-zero cost—a game-changer for global workers.”
Strategic Significance for Investors
This deal marks the first joint investment by Peak XV and HongShan since their Sequoia separation in 2023. Both firms are expanding beyond their historic regions:
- HongShan: Deploying $9B across Europe/North Asia
- Peak XV: Establishing US presence
Meanwhile, Sequoia is reportedly finalizing its first post-split Asia-Pacific investment in fintech firm Vance.
Image caption: Stablecoin adoption is accelerating globally, particularly in emerging markets. (Credit: TechCrunch)
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