Web3 startup Starlight debuts corporate cards for crypto firms: Exclusive

Quick Take

  • Brevan Howard-backed web3 startup Starlight has launched corporate cards that it hopes can simplify expense payments for crypto companies.
  • These cards allow both fiat and crypto payments that can be tracked via a treasury dashboard on the platform.
  • In light of recent events, other providers are pulling back from serving crypto companies. For instance, Ramp temporarily suspended payments from its cards for a small subset of crypto companies on Nov. 18. 

Starlight, a Brevan Howard-backed web3 payments startup, has launched corporate cards that aim to simplify expense payments for crypto businesses. 

The cards allow both fiat and crypto payments that can be tracked via a treasury dashboard on the platform; those payments then are loaded through a crypto wallet available through Starlight, or a checking account. Funds held in the fiat account are FDIC insured, according to the startup. Cards have adjustable limits for currencies such as bitcoin, USDC, ether or fiat. 

"These cards mean that if you're a DAO or a crypto business, you can spend with crypto in the real world," said founder and CEO Grey Nguyen in an interview. "That could be on your Amazon Web Services purchases or your travel tickets." 

The goal to build corporate cards for crypto companies aligns Starlight with a number of other venture-backed businesses launched in recent years, which look to ease payments for crypto businesses. In April this year, Rain raised $6 million from Lightspeed Ventures to launch corporate credit cards for DAOs. Starlight raised $5 million in seed funding in the same month — a round which was co-led by Abstract Ventures and A* Capital with participation from Brevan Howard. The Sequoia-backed Multis also launched corporate cards for crypto treasuries earlier this month.  

Currently, many fledging crypto startups either use a personal wallet to fund crypto-related expenses or rely on exchanges to house treasuries, said Nguyen. It can take months to complete sign ups, and leave crypto startups vulnerable to potential withdrawal stoppages, as in the case of FTX. 

The FTX fallout 

Amid crypto exchange chaos, other providers have been pulling back from serving crypto companies.

Per an email sent on Nov. 18, expenses firm Ramp temporarily suspended spending on its cards for a small subset of crypto companies, citing "unprecedented events in cryptocurrency, blockchain, NFT and DeFi ecosystem." The companies were asked to provide balance and income sheets and a list of any accounts that they held with exchanges from the last twelve months. 

Among those affected was DeFi API startup Conduit, which raised a $17 million round in January. NFT startup Tokenproof and the Karn Saroya-founded Re Protocol also had their ability to spend via Ramp curtailed, per the Ramp support Twitter page

Over direct message last week, both Tokenproof founder Alfonso Olvera and Conduit's Kirill Gertman confirmed that their spending limit had either been cut or revoked in the days following the email from Ramp — two days after Genesis Global Capital suspended redemptions. 

“We are always monitoring and responsive to what’s going on in the market," said a Ramp spokesperson. "In light of unprecedented events in the crypto ecosystem, we conducted a comprehensive risk review of businesses on our platform in the crypto, blockchain, NFT, and DeFi space and took proactive steps based on the outcome of that review." 

The company has since reinstated many of the original spending limits, said the spokesperson but the incident shows some of the issues crypto companies when handling fiat and crypto. Conduit's Gertman said over the Telegram message that the incident has inspired him to look for another vendor. 

Indeed, Starlight's clients are heavily weighted towards crypto companies, with NFT community platform Highlight and DAOs such as CabinDAO using its services, but Nguyen hopes that it can branch out to larger companies interested in crypto payments as well. 

"We've been chatting with large companies — S&P 500 type of companies. They've come to us and we've been showing them how we can simplify the process," he said. "You've seen this sort of playbook play out already in the Web2 space with Ramp and Brex really starting out with the small guys and then going to the larger enterprises."

Update: This story has been updated following further clarification from a Ramp spokesperson. 

© 2023 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.