Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Cycles Raises $6.4M For On Chain Clearing
May 22, 2026 | NCFA Fintech Market Activity | Digital Assets Blockchain And Tokenization, Payments And Money Movement, Capital Markets And Market Infrastructure
Net Settlement Targets Crypto Liquidity Drag
On May 21, 2026, Toronto based Cycles raised $6.4 million to build an open, privacy preserving clearing network for crypto markets and stablecoin payments. Blockchange Ventures led the round, with participation from Coinbase Ventures, Compound VC, Primitive Ventures, and angel investors. The round brings Cycles’ total funding to $8.7 million, following a $2.3 million pre seed in 2025.
Cycles is targeting one of the least glamorous but most important parts of financial infrastructure: clearing. In traditional markets, clearing reduces how much money has to move between counterparties by offsetting obligations first. Cycles wants to bring that function to on chain finance, where trading and payment flows still often require too much prefunding and too much gross settlement.
See: Bank Of Canada Maps Global Crypto Flow Patterns
The first institutional product is Cycles Prime, which lets trading firms privately net OTC obligations across the network. Cycles says this can reduce liquidity requirements and counterparty exposure without requiring collateral, asset movement, or a change in counterparties. Cycles Prime is launching with Lynq and FalconX as anchor partners.
Ethan Buchman, Co Founder and CEO, Cycles:
“Clearing is a financial superpower that has historically only been available to large financial institutions,”
Crypto Still Moves Too Much Money
Without clearing, firms often move full payments back and forth instead of only settling the difference. That ties up capital and can increase risk when markets move quickly.
The release points to October 10, 2025, when more than $19 billion in crypto leverage was liquidated in roughly one day, with 70% of forced liquidations occurring in just 40 minutes. Cycles uses that event to show why capital efficiency matters. When markets rely on gross settlement and heavy prefunding, stress can move fast.
Cycles is betting that multilateral clearing can reduce that pressure. Meaning, many obligations can be matched against each other so less money has to move. If it works, trading firms may keep less idle capital parked across venues and counterparties.
Stablecoin Payments Need Clearing Too
The second product is Cycles Pay, a stablecoin payments app for individuals and businesses. Payments are routed through Cycles’ clearing engine, which nets obligations across participants to minimize capital movement. The product also includes invoicing and expense management with credit planned.
See: Stablecoins Split Into Issuance And Service Layers
Stablecoins already help move value across networks. Clearing can make those flows more capital efficient. For businesses, the value isn't only faster payment. It's fewer trapped balances, better cash flow, and more private settlement.
Rob Schmults, General Partner at Blockchange Ventures:
"Clearing is the cornerstone of capital-efficient markets like foreign exchange allowing the movement of massive volumes of value without crippling liquidity requirements. We see Cycles providing an essential coordination layer to bring the efficiency and effectiveness of clearing to new markets. Doing this will allow businesses to clear and settle payments privately, optimize capital flow, and reduce the need for idle capital. As global adoption accelerates, Cycles can become a category defining standard for how value is settled and netted across entire ecosystems and markets."
Talking Point
If stablecoins are becoming payment rails, will clearing become the missing layer that turns on chain settlement from fast movement into capital efficient market infrastructure?
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