Dave Inc. is adding cryptocurrency to its fintech platform.
The West Hollywood banking app announced after the market closed on Monday a strategic partnership and a $100 million investment that will help it expand into the digital assets ecosystem.
On Tuesday morning after the news, Dave’s shares opened down 14%.
Dave struck the partnership with West Realm Shires Services Inc., owner and operator of FTX US, the cryptocurrency exchange that ran a Super Bowl ad starring Larry David. The $2 billion venture fund FTX Ventures is investing the money.
The deals give Dave additional resources to grow and invest in initiatives including crypto, such as adding digital asset payments to its platform, and FTX US will serve as the company’s exclusive partner for cryptocurrencies.
“We believe blockchain technology has the potential to level the financial playing field across the globe,” said Dave CEO Jason Wilk in a statement. “By aligning with a world-class leader such as FTX US, we are in position to enter the digital asset arena, explore new growth opportunities and improve the member experience.”
“We consistently look to align with companies that share our vision, have unique and disruptive business models, and can help drive widespread adoption of digital assets,” added FTX US President Brett Harrison. “Dave is a great fit as they check all three boxes.”
The move comes a couple of months after Dave (Nasdaq: DAVE) went public via a reverse merger with VPC Impact Acquisition Holdings III Inc., a special purpose acquisition company sponsored by Victory Park Capital.
Shares opened on Jan. 6 at $8.27 and closed Tuesday at $9.56, marking nearly 16% growth since then. However, Monday’s closing price was $10.60, and after the FTX announcement, the stock opened on Tuesday at $9.07 — down more than 14%.
The $100 million investment came via an unsecured convertible note with an interest rate of 3% per year compounded semi-annually.
