Digital asset management startup Utila Inc. today announced that it raised $22 million in a Series A extension round as the institutional demand for cryptocurrency known as stablecoins continues to rise.

In the past year, stablecoins have caught the attention of the financial industry, including banks and payment processors. A stablecoin is a type of cryptocurrency that maintains parity with a traditional currency, such as USD, so that one token is always $1. The result is that stablecoins are “stable,” and don’t suffer from the volatility of other cryptocurrencies, making them suitable for exchanging for goods and services.

Red Dot Capital Partners led the extension, which comes six months after the company announced its $18 million Series A in March, bringing the total raised across the round to $40 million. Nyca, Wing VC, DCG, Cerca Partners, Funfair Ventures and SilverCircle also participated in the round.

Utila said the extension came without effort from the startup, with venture capital investors providing offers amid explosive growth in the stablecoin market. The company added that its initial Series A round remains largely untouched.

Over the past six months, the stablecoin market has seen significant regulatory developments and a surge in institutional adoption. A major milestone has been legislation passed in the United States with the GENIUS Act, which stands for the Guiding and Establishing National Innovation for U.S. Stablecoins Act. It is a law establishing the first wide-ranging regulatory framework for the digital currency.

The global stablecoin supply has grown to $296 billion in the past months, according to CoinMarketCap, with Tether Holdings Ltd.’s USDT and Circle’s USDC leading the pack. In March, the global market capitalization surpassed $230 billion after the vote on the GENIUS Act.

“We’re witnessing a fundamental shift in how organizations handle value transfer, with stablecoins at the center of this transformation,” said Bentzi Rabi, co-founder and chief executive of Utila. “Six months ago, we positioned ourselves for the next wave of digital asset adoption. Today, that wave has arrived.”

Utila said over the past six months, the company has seen tremendous growth driven by the mainstream adoption of stablecoins by financial services. This growth has resulted in a monthly volume exceeding $15 billion and more than $90 billion in total transactions across the platform.

Industry transformation has been building, including the initial public offering in June from Circle Internet Group Inc., the company behind the popular USDC stablecoin, which raised the company about $1.1 billion. Stripe Inc., an online payment processor, acquired the stablecoin infrastructure provider Bridge Ventures Inc. late last year. Meanwhile, PayPal expanded its cryptocurrency payment offerings, which include stablecoins, to U.S. merchants.

Utila’s platform provides for the core needs of financial institutions seeking to use stablecoins, including complete infrastructure for the digital currency, secure treasury and institutional-grade trading capabilities such as security controls and regulatory compliance frameworks.

The company competes with numerous providers offering stablecoin infrastructure across the market, including the institutional digital asset management platform Fireblocks Inc., and enterprise crypto wallet and custodial solutions such as BitGo Inc. and Anchorage Labs Inc.

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