Exclusive: Dakota, a stablecoin-powered neobank, raises $12.5 million in Series A led by CoinFund

Dakota, a neobank cofounded by a former Coinbase executive, has raised $12.5 million in a Series A led by CoinFund. The startup uses stablecoins to move money between itself and its customers and has processed $1.6 billion in transaction volume over the past year. Dakota's platform has over 500 businesses using its services and is on pace to record $4 billion in transaction volume by December.

Dakota, a neobank cofounded by a former Coinbase executive, has raised $12.5 million in a Series A funding round led by CoinFund. The startup, which uses stablecoins to facilitate transactions between itself and its customers, has shown significant growth over the past year. Dakota has processed $1.6 billion in transaction volume and has over 500 businesses using its platform, with plans to reach $4 billion in transaction volume by December [1].

The funding round, which was purely for equity, is a testament to the growing interest in stablecoins and the potential they hold for modernizing payment systems. Stablecoins, which are tokens pegged to underlying assets like the U.S. dollar, have gained traction due to their ability to speed up cross-border payments and reduce transaction fees [1].

Dakota’s cofounder and CEO, Ryan Bozarth, is a veteran of Big Tech, having worked at Sony, Square, and Airbnb, and previously served as a Coinbase executive. Bozarth left Coinbase in 2022 to found Dakota, positioning the startup as a pioneer in the Web3 payment space [1].

The startup functions similarly to traditional banks, offering checking accounts and yield on deposited funds, but leverages stablecoins for transactions. Dakota does not hold its own bank charter but is regulated in the U.S. and Europe as a money services business [1].

The investment in Dakota comes at a time when large financial institutions are increasingly exploring stablecoins as a way to modernize their payment systems. Bank of America, for instance, has been assessing the space since early 2025 and has reportedly discussed the potential joint issuance of a stablecoin with other major U.S. institutions [2].

The broader adoption of stablecoins is being driven by regulatory progress and the increasing interest from large fintechs. In 2024, stablecoin transaction volumes surpassed the combined totals of Visa and Mastercard, and the value of stablecoins in circulation has surged to $257 billion [2].

While the GENIUS Act, a bill aimed at regulating stablecoins, passed the Senate in June, it has faced delays in the House. However, the bill’s passage in the Senate indicates a growing recognition of the potential of stablecoins in the financial system [2].

Dakota’s Series A funding is a significant milestone for the neobank, positioning it as a key player in the evolving landscape of digital payments. As stablecoins continue to gain traction, Dakota’s focus on using them to facilitate transactions could prove to be a strategic advantage.

References:
[1] https://fortune.com/crypto/2025/07/15/dakota-coinbase-executive-series-a-coinfund-ryan-bozarth/
[2] https://cryptoslate.com/bofa-ceo-confirms-bank-is-exploring-stablecoins-for-potential-payment-revolution/