Payment processing providers which specialize in providing service to online trading companies have gained enormous success during the past three years, with one particular firm, SafeCharge, having become a publicly listed company on the London Stock Exchange recently which raised $126 million for the firm.
This year’s new phenomenon in specialist payment processing providers could well be an interest toward those facilitating Bitcoin payment, as Canadian firm Vogogo has this week received an $8.5 million round of new funding.
From its headquarters in Calgary, Alberta, Vogogo provides automated payment processing, regulatory compliance and risk management for a range of businesses, including clients in the virtual currency sector, with Bitcoin being at the forefront.
Many highly experienced venture capital companies are beginning to show great interest in Bitcoin related enterprises, with Argentinian payment processing firm BitPagos having been the subject of recent investment, in a nation which has taken to Bitcoin on a national level.
The investment in Vogogo was led by Cormark Securities and included other venture capital partners including Beacon Securities Ltd, Canaccord Genuity Corporation, Clarus Securities and Salmon Partners.
With this funding, the company aims to expand its reach beyond Canada south of the border into the United States, and across the Atlantic into continental Europe.
In an interview with CoinDesk this week, Vogogo CSO Rodney Thompson said that his firm has become more actively involved in the digital currency space, owing to the need of the industry’s businesses for a partner that can handle fiat compliance and the associated fraud mitigation responsibilities that coincide with these offerings.
As the perceived dangers of investing in virtual currency have begun to subside post MtGox demise, many regulators have taken a keen interest in embracing virtual currency, including the notoriously risk-averse Switzerland, as well as New York’s state financial regulator very recently.
Vogogo’s payment processing system could complement the sudden interest in supporting Bitcoin by regulators – a contrast to last year’s arrest and seizure of perpetrators of illicit activity, notably surrounding the demise of Silk Road – instead providing a framework for protecting clients and vendors.
In terms of functionality, Vogogo ensures that payments made in fiat currency are managed correctly, placing a limit on client exposure to chargebacks and further matters that pertain to responsibility for client funds.
Vogogo has pledged that it will ensure fraud mitigation on behalf of customers, including the management of bad debt, and any other non-compliant activity that could potentially take place will be managed by Vogogo, adding to the growing customer confidence in using Bitcoin as a genuinely mainstream method of payment.