Crypto hardware wallet maker Ledger raises $109 million in new funding

Ledger SAS, a Paris-based startup that manufactures crypto wallet hardware, today announced that it has raised most of a $109 million funding round.

Bloomberg reported that the firm’s valuation remains about $1.4 billion, which is about the same as the company had during its previous titanic funding round in June 2021, when Ledger raised $380 million in a Series C funding round.

The company attracted a number of new investors including True Global Ventures, Cité Gestion SPV, Digital Finance Group and VaynerFund. Also participating in the round were existing backers 10T, Cap Horn, Morgan Creek and Cathay Innovation.

Ledger produces hardware products and services that help companies and consumers secure their blockchain-based crypto tokens and currencies. The company’s current devices are similar to USB keys and feature small screens that allow users to confirm transactions and act without connecting to the internet.

Hardware wallets offer security because they allow users to store the private keys that represent their crypto wallet in the device itself, which never leaves the wallet and is protected by a secure chip. When it’s time to send or receive crypto tokens, the device is connected to another machine, such as a smartphone or a computer, and the process of validating the transaction is authenticated by the user directly.

When a hardware wallet is first booted up, users are asked to create a “recovery phrase,” which is 24 words that represent their wallet address. If their Ledger device is lost, destroyed or stolen, they can use it to restore their Ledger account on a new wallet.

Ledger’s flagship products include the tiny Ledger Nano X and Ledger Nano S Plus, both of which are designed to fit in your pocket and connect to smartphones or other devices to help people manage crypto transactions. The Nano X also comes with Bluetooth to make connecting with smartphones easy for managing crypto and nonfungible tokens as easy.

The company also recently introduced Ledger Stax, a credit card-sized device with an E Ink display that can connect with Bluetooth currently in preorder. It has the same security as every other Ledger device, but with a much larger screen so that users can more easily see what they’re working with and customize images on the touchscreen.

Consumers can also use Ledger Live, the company’s own app, to buy, sell and trade crypto directly – or connect their wallet to numerous other blockchain-enabled apps.

The crypto business can be fraught with security issues and there have been numerous stories of hackers and scams circulating. That has led to users seeking greater security for their tokens, which has been a benefit to Ledger’s bottom line.

The biggest driving force for Ledger’s sales has been the recent turmoil for cryptocurrency exchanges, such as the dramatic collapse and bankruptcy of FTX Trading Ltd. When FTX shut down, many users with their assets on the platform could no longer access them, leading to others withdrawing theirs from other exchanges. This is not an uncommon cry in the crypto community: “Not your keys, not your crypto.”

“Suddenly people were like ‘Wow, to leave crypto on an exchange is actually dangerous,’” Ledger Chief Executive Pascal Gauthier said in an interview with Bloomberg. “And 2023 is even better for us because now you can’t even leave money at a Swiss bank.”

In fact, the company had its biggest month of sales in November, right after the demise of FTX. Revenue from Ledger Live doubled year-on-year as a result. Ledger added that it currently stores more than 20% of the world’s total cryptocurrencies and 30% of the world’s nonfungible tokens.

Gauthier said Ledger will use the new funding to expand its network of distributors, as well as increase production and development on products with an eye to grow the business in line with the booming demand.

Image: Ledger