Crypto Startup Magic Raises $52M in Round Led by PayPal Ventures
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Crypto Startup Magic Raises $52M in Round Led by PayPal Ventures

Wallet-as-a-service providers such as Magic aim to simplify the onboarding process to drive Web3 adoption.
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Magic, a Web3 wallet maker based in San Francisco, raised $52 million in a funding round led by PayPal Ventures and joined by prominent investors, including Synchrony, Volt Capital, KX, Northzone, and Cherubic. With the new funding round, Magic’s valuation now stands close to $500 million.

Magic Raised Over $80M So Far

Web3 wallet developer Magic announced on Wednesday it had bagged $52 million in a strategic funding round led by PayPal Ventures, bringing the project’s total funds raised to more than $80 million and valuing the company at just below $500 million. Other investors participating in the financing round include Cherubic, Synchrony, KX, Northzone, and Volt Capital.

Even though the crypto wallet market is quite competitive, Magic has managed to stand out from its competitors by developing a white-label version that enables enterprises to provide wallets en masse to their customers. In other words, the company is on a mission to facilitate Web3 mass adoption by serving as a wallet-as-a-service (WaaS) provider for companies looking for simple ways to lure their clients to Web3.

To achieve this, the crypto wallet maker develops an enterprise-grade, low-effort solution that allows Web3 migration, paving the way for lucrative revenue sources such as customer loyalty programs, digital collectibles, membership, and ticketing. The San Francisco-based Web3 firm already collaborates with prominent brands across retail, fashion, and gaming industries, such as Mattel, Xsolla, Macy’s, and Immutable.

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Magic Seeks to Simplify Web3 Onboarding

Magic founder and CEO Sean Li discussed some of the biggest challenges companies face when trying to foray into Web3. To make this easier for them, the wallet maker has been focusing on building Web3 tools that clients can access through Web2-style interfaces, which they are already familiar with, Li told Fortune.

“One of the biggest barriers to entry in Web is onboarding. Writing down a seed phrase on a piece of paper is backwards, like burying pirate treasure.”

– Sean Li said.

Earlier this year, crypto exchange Coinbase also launched a WaaS solution similar to Magic, which aims to facilitate Web3 onboarding. The product allows companies to develop fully customizable Web3 wallets using their apps, which makes the user onboarding process significantly simpler.

Over the past year, several non-crypto companies have also unveiled plans to foray into the nascent Web3 world, emphasizing the tremendous potential of its underlying technologies. Some of those companies include SK Telecom, GameStop, and Wall Street giant JPMorgan.

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