Alibaba Backed Latin America Stablecoin Company, Why VelaFi?

Original Title: "Alibaba Invests in Latin American Stablecoin Financial Company"

Original Author: KarenZ, Foresight News

A financial infrastructure platform deeply rooted in Latin America and committed to bridging the fiat and crypto worlds is making a name for itself.

On January 12, VelaFi officially announced the completion of a $20 million Series B funding round. With this round of funding, VelaFi's total funding has exceeded $40 million. This funding amount not only validates the market's confidence in the stablecoin payment track.

Of note, Alibaba Investment, a subsidiary of Alibaba, appeared in VelaFi's investor lineup.

Why Alibaba?

Alibaba Investment is a wholly-owned subsidiary of Alibaba established in the British Virgin Islands in 2000.

As one of the world's largest B2B and B2C e-commerce platforms, Alibaba understands the pain points of cross-border payments—high fees, long settlement periods, and exchange rate fluctuation risks.

Meanwhile, VelaFi's stablecoin infrastructure enables instant, low-cost cross-border settlements. VelaFi's focus on emerging markets like Latin America aligns with Alibaba's key growth regions for AliExpress and Alibaba.com.

Through this investment, Alibaba is likely exploring the use of stablecoin technology to optimize its local payments and merchant settlement experience in emerging markets.

Who Else is Betting on VelaFi?

VelaFi's latest funding round was led by XVC and Ikuyo, with participation from Alibaba Investment, Planetree (an Alibaba affiliate), and existing investor BAI Capital, among others. To date, VelaFi has raised over $40 million in funding.

One of the lead investors, XVC, is a Beijing-based dual-currency (RMB and USD) fund management firm. Its partner, Boyu Hu, has invested in notable companies such as Kuaishou, Weee!, Walnut Programming, and Queen Tea Princess.

The other lead investor, Ikuyo, is a Tokyo Stock Exchange-listed company. This investment is not their first interaction; back in November 2025, when VelaFi entered the Japanese market, they had already formed a strategic partnership to co-organize a stablecoin settlement association, offering exporters and global businesses a more transparent and cost-effective settlement service.

Who is VelaFi?

VelaFi is a part of Galactic Holdings. Galactic Holdings was founded by a Chinese team, with its co-founder and CEO Maggie Wu also serving as the CEO of VelaFi and the founder of the well-known investment institution Krypital Group.

Galactic Holdings owns the cryptocurrency wallet TruBit, the trading platform TruBit Pro, and the enterprise-focused cross-border payment solution TruBit Business. In 2025, the existing enterprise business TruBit Business was officially rebranded as VelaFi.

Currently, VelaFi started in Latin America and has expanded its business to the United States and Asia. VelaFi reports that it has served hundreds of corporate clients to date, processing billions of dollars in payment transactions.

Core Business Model

VelaFi focuses on the B2B market. To ensure compliance, all corporate clients must undergo strict KYC (Know Your Customer) and KYB (Know Your Business) verification before they can access VelaFi's service network.

Its core model can be summarized as follows:

1. Fiat On-Ramp & Off-Ramp

This is VelaFi's core business, aimed at addressing the industry challenge of free conversion between fiat and stablecoins.

On-Ramp: Allows a company's end users to make payments in local fiat currency, with the company receiving an equivalent amount of stablecoin (such as USDT/USDC) or Bitcoin and other assets.

Off-Ramp: The company sends stablecoins to VelaFi, which then uses the local banking network to deposit the funds into the user's bank account in local fiat currency.

2. Global Payments & Cross-Border Transfers

Another service offered by VelaFi is global payment services, facilitating cross-border fund transfers through a "Fiat A to Fiat B" path. For example, a Mexican company can make a payment to a Brazilian supplier. Previously, this required intermediaries, but now, through VelaFi, payment is made in Pesos (MXN), and the recipient receives Reais (BRL).

VelaFi is like an "accelerator" built on top of the traditional banking rails.

Its core advantage lies in deep integration with Latin America's mainstream instant payment systems: Mexico's Bank-to-Bank Electronic Payment System (SPEI), Brazil's Instant Payment System (PIX), Colombia's Payment System (PSE). By linking these traditional payment rails with stablecoin liquidity, VelaFi enables cryptocurrency to land not just on-chain but potentially in cross-border e-commerce, labor outsourcing, and international trade.

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