Yotta Technologies
| Company type | Private |
|---|---|
| Industry | Financial technology, Online gambling |
| Founded | October 2019 |
| Founder | Adam Moelis, Ben Doyle |
| Headquarters | San Francisco , United States |
| Products | Sweepstakes gaming services, prize-linked savings accounts (previously) |
Yotta Technologies is a United States-based financial technology (fintech) firm that provides sweepstakes gaming services and previously offered a prize-linked savings account. On May 11, 2024, after the collapse of its fintech collaborator Synapse, Yotta's users were unable to access their funds. Since Yotta does not operate as a bank, its customers did not qualify for deposit insurance. , only partial compensation has been extended to affected depositors.
Savings account provider
Established in October 2019 by Adam Moelis, son of billionaire investment banker Ken Moelis, alongside Ben Doyle, Yotta debuted its platform in July 2020. Initial backers included hedge fund manager Cliff Asness and Ken Moelis himself. In January 2021, the company secured $13.2 million in a Series A financing round led by Base10 Partners, with additional investments from Y Combinator, Core Innovation Capital, and Slow Ventures.
At launch, Yotta offered depositors an interest rate of 0.2%, directing the remaining interest earnings into a prize pool featuring a grand prize initially set at $10 million, later lowered to $1 million (which remained unclaimed). New York Times columnist Peter Coy described Yotta as "a smart way to turn gambling into a virtue". Users received sweepstakes entries proportional to their deposited amounts. In September 2022, one participant won $500,000 through the sweepstakes.
During 2022, Yotta initiated an influencer marketing strategy. Influencers played a key role in driving the expansion of the customer base.
Challenges with funds accessibility
Yotta relied on Synapse, a fintech firm based in San Francisco, to facilitate access to funds via partner banks such as Evolve Bank & Trust, headquartered in Arkansas. Following a disagreement between Synapse and Evolve, Synapse initiated Chapter 11 bankruptcy proceedings in 2024, which affected Yotta along with at least 24 other startups. In June 2024, CEO Adam Moelis revealed that 85,000 Yotta account holders, collectively holding $112 million in deposits, were unable to withdraw their money. While the partner banks maintained FDIC deposit insurance, the FDIC has not taken action since no bank has officially failed.
According to a bankruptcy court document filed on June 20, 2024, Evolve disclosed that eight banks held $109 million of Yotta customer deposits on April 11, but this amount had decreased to $1.4 million by mid-May. During this interval, neither the customers nor Evolve accessed these funds. Moelis asserted that as of May 17, Evolve was holding $112 million; however, Evolve contests this figure. In September 2024, Yotta initiated legal action against Evolve in the U.S. District Court for the Northern District of California, accusing the bank of colluding with Synapse to improperly appropriate customer deposits.
By November 2024, out of $64.9 million in total deposits, 13,725 Yotta depositors were offered $11.8 million in reimbursements, with some receiving less than one percent of their original amounts. A grassroots organization named Fight For Our Funds emerged to campaign for further compensation.
Sweepstakes
In June 2024, Coffeezilla, a YouTube content creator known for exposing financial frauds, revealed that Yotta had transitioned its business approach toward casino-style gaming such as blackjack, dice, and roulette. These games were supported by microtransactions rather than traditional savings deposits. The company changed its Twitter username from @yottasavings to @winwithyotta, discontinued payouts on savings accounts, and concentrated solely on marketing its sweepstakes-based games.