A $2 million pre-seed fundraising round headed by P1 Ventures has been completed by Kotani Pay, which provides crypto on-off ramps in numerous African nations.

There were several more investors who took part in the round, including:

P1 Ventures
DCG/Luno and
Flori Ventures,

The Kenyan startup is set to expand its solutions to more African countries, specifically in:

Rwanda
Senegal
Ivory Coast
Tanzania, and
Nigeria

According to reports, the startup has so far expanded to Kenya, Ghana, Zambia, and South Africa. Here, it provides software that links local payment networks and blockchains so that users can withdraw money using the USSD (Unstructured Supplementary Service Data) interface.

Several blockchain products use Kotani’s software, which is provided on a B2B basis, to link their smart contracts to mobile money APIs.

Kotani’s notable business associates include:

YellowCard
DCG
FonBnk
Valora
Mercy Corps
UNICEF Crypto Innovation Fund
Stellar

Additionally, Kotani Pay reportedly allows firms to on-ramp cryptocurrency assets from local currencies. However, the corporation may consider selling them straight to clients after receiving regulatory approval.

Following the acquisition of Nigerian startup Fuhlstack, Kotani Pay plans to launch more products, such as Reconset, a Reconciliation-as-a-Service offering, and Money Ledger, a Ledger-as-a-Service solution. Lemuel Okoli, the founder of Fuhlstack, is a co-founder of Kotani Pay alongside Macharia and Samuel Kariuki.

On the regulatory front, the business is more optimistic than ever as more African governments open up to cryptocurrencies, particularly CBDCs, which appear to have advantages similar to Kotani’s solutions.

With Botswana, Mauritius, and South Africa all announcing Virtual Asset Service Provider Licences that regulate digital assets fintechs, we are seeing great advances in the southern portion of Africa. Another encouraging development is the passage of MiCa by the European Union parliament, which controls stablecoin issuers, on- and off-ramps, and exchanges, according to Macharia, co-founder of Kotani Pay.

Based on our interactions with Kenyan authorities like the Capital Markets Authority, we think additional markets like Kenya, Ghana, and Nigeria will eventually follow up.