Middle East Tensions Boost Stablecoin Startups' Investment Amid Geopolitical Risks

Venture capitalists will re-evaluate opportunities due to heightened geopolitical risk, analysts say. The escalating war in the Middle East will force investors to rethink “asset security, liquidity, and stability in an increasingly multipolar world,” Tim Sun, senior researcher at Hong-Kong asset manager Hashkey Group, told DL News. But some sectors — primarily stablecoins — will win from the chaos, he stressed. “Instability actually strengthens the core thesis for stablecoins,” Sun said. “When traditional banking channels face sanction risks or capital controls, stablecoins become the default settlement layer.” “Demand only grows in a risk-off environment. Infrastructure that enables faster, cheaper stablecoin settlement—whether on/off-ramps, compliance tools, or cross-chain bridges—will continue to attract capital,” he said. Still, crypto startups raised an impressive $192 million this week, DefiLlama data shows. That brings this year’s total fundraising up to $2.75 billion so far. Here are the top three funding rounds this week. Kast, $80 million London-based stablecoin-focused fintech Kast raised $80 million in a Series A round at a $600 million valuation. The round was led by QED Investors and Left Lane Capital, backing the company’s push to link digital dollars more closely with everyday retail payments. Kast’s platform integrates major stablecoins such as USDT and USDC with widely used mobile wallets including Apple Pay, allowing users to spend crypto balances through familiar consumer channels. Cryptio, $45 million Crypto accounting platform Cryptio secured $45 million in a Series B funding round this week.Sentinel Global and Blackfin Capital Partners led the raise. The company provides software designed to deliver audit-ready accounting data for enterprises handling crypto transactions, an increasingly important requirement as regulators tighten oversight of the sector. The new capital is expected to support expansion among large financial institutions grappling with reporting, tax and compliance obligations tied to digital asset activity. The deal reflects a broader shift in investor priorities, with funding increasingly directed towards back-office infrastructure that enables transparency and regulatory compliance rather than the experimental protocols that dominated earlier crypto cycles. Zcash Open Development Lab, $25 million The Zcash Open Development Lab has raised $25 million to strengthen the core infrastructure of the privacy-focused cryptocurrency network and expand the usability of its ecosystem. The funding will support development of the Zodl wallet and related interoperability tools designed to make Zcash easier to use across different blockchain networks. Despite increasing regulatory pressure on privacy-focused technologies, the investment suggests that some backers still regard privacy-preserving tools as a fundamental component of digital financial infrastructure. The focus of the funding also points to a shift in priorities within the ecosystem, from purely technical protocol work towards broader usability and cross-chain integration. You’re reading the latest instalment of The Weekly Raise, our column covering fundraising deals across the crypto and DeFi spaces, powered by DefiLlama.Lance Datskoluo is DL News’ Europe-based markets correspondent. Got a tip? Email him at lance@dlnews.com.