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Long gone are the days when venture capital was flowing into fintech startups with bold ideas — and little to show in terms of business metrics and fundamentals.

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AMSTERDAM — The financial technology industry is embracing a new normal — with some industry executives and investors believing the sector has reached a “bottom.”

Executives and investors at the Money20/20 event in Amsterdam last week told CNBC that valuations have corrected from unsustainable highs from the industry’s heyday in 2020 and 2021.

Long gone are the days when venture capital was flowing into startups with bold ideas and little to show in terms of business metrics and fundamentals.

Iana Dimitrova, CEO of embedded finance startup OpenPayd, told CNBC in an interview at the firm’s booth that the market has “recalibrated.”

Embedded finance refers to the trend of technology companies selling financial services software to other companies — even if those companies don’t offer financial products themselves.

“Value is now ascribed to businesses that manage to prove there is a solid use case, solid business model,” Dimitrova told CNBC.

“That is recognised by the market, because three, four years ago, that was not necessarily the case anymore, with crazy ideas of domination and hundreds of millions of dollars in VC funding.”

Iana Dimitrova, CEO of OpenPayd, talking onstage at Web Summit in Lisbon, Portugal.

Horacio Villalobos | Getty Images

“I think the market is now more sensible,” she added.

Lighter footfall, talks happen on the fringes 

Around the show floor of the RAI conference venue last week, banks, payment companies and big technology firms showed off their wares, hoping to reignite conversations with prospective clients after a tough few years for the sector.

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Many attendees CNBC spoke with mentioned that the conference hall was a lot lighter in terms of conferencegoers and the pitter-patter of delegates flocking to various stands and booths around the RAI.

Many of the most productive conversations, some attendees CNBC spoke with say, actually happened on the fringes of the event — at bars, restaurants and even boat parties held around Amsterdam once the day on the show floor was over.

In 2021, global fintech funding reached an all-time peak of $238.9 billion, according to KPMG. Companies such as Block, Affirm, Klarna, and Revolut had hit seismically high multibillion-dollar valuations.

But by 2022, investment levels sank sharply and fintechs globally raised just $164.1 billion. In 2023, funding sank even further to $113.7 billion, a five-year low.

Have we reached the bottom?

That’s despite the massive growth of many companies. 

The bruising impact of higher interest rates means that, for even the hottest and fastest-growing players, funding is either hard to come by — or being offered at a lower prices than before.

Worldpay president: AI could help combat fraud in payments industry

Nium, the Singaporean payments unicorn, said in an announcement Wednesday that its valuation had fallen to $1.4 billion in a new $50 million funding round.

Prajit Nanu, CEO of Nium, told CNBC that investors have at times been too distracted with artificial intelligence to pay attention to innovative products and growth stories happening in the world of fintech.

“Investors are now in the AI mindset,” he told CNBC. “Like, whatever it costs. I want in on AI. They’re going to burn a lot of money.”

Nanu added that the trend mimics the “craziness” fintech saw in terms of frothy valuations in 2020 and 2021.

Today, he believes we have now reached a “bottom” when it comes to fintech market values.

“I believe that this is the lowest end of the fintech cycle,” Nanu said, adding that “this is the right time to make it in fintech.”

Consolidation will be key moving forward, Nanu said, adding that Nium is eyeing several startups for acquisition opportunities.

OpenPayd’s Dimitrova said she isn’t considering tapping external investors for fundraising at the moment.

Watch CNBC's full interview with Shailendra Singh, managing director of Peak XV Partners, one of Asia's biggest venture capital firms

But, she said, if OpenPayd were to look to accelerate its annual recurring revenue past the $100 million mark, venture capital investment would come more firmly under consideration.

Crypto comeback?

Crypto also made something of a comeback in terms of hype and interest at this year’s event.

Dotted around the RAI venue were stands from some of the industry’s major players. Ripple, Fireblocks, Token8 and BVNK, a crypto-focused payments firm, all had a big presence with notable booths around.

CoinW, a crypto exchange endorsed by Italian soccer star Andrea Pirlo, had advertising flowing through a bridge connecting two of the main halls of the conference.

Fintech execs and investors CNBC spoke with at this year’s edition of Money20/20 said they’re finally seeing a real use case for cryptocurrencies after years of bulls touting them as the future of finance.

Despite the huge promise of AI around changing how we manage our money, for instance, “there’s no new AI for moving money,” according to James Black, partner at VC firm IVP — in other words, AI isn’t changing the infrastructure behind payments. 

However, stablecoins, tokens that match the value of real-world assets like the U.S. dollar, he said, are changing the game.

“We’ve seen the crypto wave, and I do think that stablecoins is the next wave of crypto that will gain more mass adoption,” Black said.

“If you think about the most exciting payment rails, you have real-time payments — I think that’s exciting, too. And it fits in with stablecoins.”

Charles McManus, CEO of ClearBank, speaks at the Innovate Finance Global Summit in April 2023.

Chris Ratcliffe | Bloomberg | Getty Images

ClearBank, the U.K. embedded finance startup, is working on launching a stablecoin underpinned by the British pound that it is expecting to receive a provisional blessing from the Bank of England soon.

Emma Hagen, CEO of ClearBank, and Charles McManus, the firm’s chair, told CNBC at its booth at Money20/20 that the stablecoin it’s working on would be sufficiently backed by a matching number of reserves.

“We’re in the early days as we learn with our partners,” Hagen told CNBC. “It’s about doing it in a way that gives people that trust and safety that there is going to be practical issuance.”

ClearBank is also working with other crypto companies on offering the ability to earn high yield on uninvested cash, McManus said.

He declined to disclose the identity of which firm, or firms, ClearBank was in talks with.

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Defense manufacturing startup Hadrian closes $260 million funding round led by Peter Thiel’s Founders Fund

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Defense manufacturing startup Hadrian closes 0 million funding round led by Peter Thiel's Founders Fund

Startup Hadrian raises $260 million to expand its AI-powered factories to meet soaring demand

Defense manufacturing startup Hadrian on Thursday announced the closing of $260 million Series C funding round led by Peter Thiel‘s Founders Fund and Lux Capital.

The machine parts company said it will use the funding to build a new 270,000 square foot factory in Mesa, Arizona, and expand its Torrance, California, location as it looks to beef up its shipbuilding and naval defense capabilities.

“What we really need in this country is this quantum leap above China’s manufacturing model,” said CEO Chris Power in an interview with CNBC’s Morgan Brennan. “It’s about supercharging the worker versus replacing them.”

Defense tech startups like Hadrian are disrupting the mainstay defense contracting industry, which is led by leaders such as Northrop Grumman and Lockheed Martin, and battling it out to boost U.S. defense production while scooping up Department of Defense contracts.

An overall view of the manufacturing line in a Hadrian Automation Inc. factory.

Courtesy: Hadrian Automation, Inc.

Hadrian said the Arizona space will be four times the size of its California facility and start operations by Christmas. The factory will create 350 local jobs. The Hawthrone, California-based company said it is working on four to five new facilities to support production over the next year to support Department of Defense needs.

Read more CNBC tech news

Hadrian said it uses robotics and artificial intelligence to automate factories that can “supercharge American workers.”

Power said demand is rapidly growing, but the lack of U.S.-based talent is a major hurdle to building American dominance in shipbuilding and submarines.

Using its tools, the company said it can train workers within 30 days, making them 10 times more productive. Its workforce includes ex-marines and former nurses who have never set foot in a factory.

An overall view of the manufacturing line in a Hadrian Automation Inc. factory.

Courtesy: Hadrian Automation, Inc.

“We have to do a lot more … but certainly we’re able to keep up with the scale right now, and grateful to our team and customers for letting us go and do that,” he said. “As a country, we have to treat this like a national security crisis, not just the economics of manufacturing.”

The fresh raise also includes investments from Andreessen Horowitz and new stakeholders such as Brad Gerstner’s Altimeter Capital.

The company closed a $92 million funding round in late 2023.

WATCH: Startup Hadrian raises $260 million to expand its AI-powered factories to meet soaring demand

An overall view of the manufacturing line in a Hadrian Automation Inc. factory.

Courtesy: Hadrian Automation, Inc.

The Kuka arm is seen at a Hadrian Automation Inc. factory.

Courtesy: Hadrian Automation, Inc.

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Amazon cuts some jobs in cloud computing unit as layoffs continue

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Amazon cuts some jobs in cloud computing unit as layoffs continue

Attendees walk through an exposition hall at AWS re:Invent, a conference hosted by Amazon Web Services, in Las Vegas on Dec. 3, 2024.

Noah Berger | Getty Images

Amazon is laying off some staffers in its cloud computing division, the company confirmed on Thursday.

“After a thorough review of our organization, our priorities, and what we need to focus on going forward, we’ve made the difficult business decision to eliminate some roles across particular teams in AWS,” Amazon spokesperson Brad Glasser said in a statement. “We didn’t make these decisions lightly, and we’re committed to supporting the employees throughout their transition.”

The company declined to say which units within Amazon Web Services were impacted, or how many employees will be let go as a result of the job cuts.

Reuters was first to report on the layoffs.

In May, Amazon reported a third straight quarterly revenue miss at AWS. Sales increased 17% to $29.27 billion in the first quarter, slowing from 18.9% in the prior period.

Amazon said the cuts weren’t primarily due to investments in artificial intelligence, but are a result of ongoing efforts to streamline the workforce and refocus on certain priorities. The company said it continues to hire within AWS.

Amazon CEO Andy Jassy has been on a cost-cutting mission for the past several years, which has resulted in more than 27,000 employees being let go since 2022. Job reductions have continued this year, though at a smaller scale than preceding years. Amazon’s stores, communications and devices and services divisions have been hit with layoffs in recent months.

AWS last year cut hundreds of jobs in its physical stores technology and sales and marketing units.

Last month, Jassy predicted that Amazon’s corporate workforce could shrink even further as a result of the company embracing generative AI.

“We will need fewer people doing some of the jobs that are being done today, and more people doing other types of jobs,” Jassy told staffers. “It’s hard to know exactly where this nets out over time, but in the next few years, we expect that this will reduce our total corporate workforce.”

WATCH: Amazon CEO says AI will change the workforce

AI will change the workforce, says Amazon CEO Andy Jassy

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Taiwan Semi is speeding up U.S. chip production due to demand, CEO says

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Taiwan Semi is speeding up U.S. chip production due to demand, CEO says

Signage for Taiwan Semiconductor Manufacturing Company (TSMC) at it’s fabrication plant in Phoenix, Arizona, US, on Monday, March 3, 2025. 

Rebecca Noble | Bloomberg | Getty Images

Taiwan Semiconductor Manufacturing Company CEO C.C. Wei on Thursday said the company is seeing “strong interest” from its leading U.S. customers and is working to speed up its volume production schedule by several quarters.

TSMC is the world’s largest contract chip manufacturer, and the company has pledged to invest a total of $165 billion in advanced semiconductor manufacturing in the U.S. The company shared updates to its global manufacturing plans during its second-quarter earnings call on Thursday.

“TSMC will continue to play a critical and integral role in enabling our customers’ success, while also maintain a key partner and network of the U.S. semiconductor industry,” Wei said on the call.

As part of its investment in the U.S., TSMC is building six advanced wafer manufacturing fabrication facilities in Arizona, two advanced packaging fabrication facilities and an R&D center.

Read more CNBC tech news

Wei said the first fabrication facility in Arizona is already complete, the second has been built and construction is underway at the third.

The company reported $31.7 billion in revenue for the period, as well as nearly a 61% rise in profit year over year, hitting a record high and beating estimates.

U.S. President Donald Trump has threatened steep “reciprocal tariffs” of 32% in Taiwan, but the country is carrying out trade talks with the U.S., according to local media reports. Trump warned of potential additional tariffs on semiconductors earlier this month.

“Looking into second half of 2025, we have not seen any change in our customers’ behavior so far,” Wei said. “However, we understand the uncertainties and risk from the potential impact of tariff policies, especially on consumer-related and the price-sensitive, end-market segment.”

WATCH: TSMC posts second-quarter profit surge — here are the key points

TSMC posts second-quarter profit surge — here are the key points

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