The Financial Times reported on Sunday that two of the world’s major investment banks just made a big investment in cryptocurrency trading platform Elwood Technologies, US banking giant Goldman Sachs and British powerhouse Barclays participated in a $70 million funding round alongside venture capitalist (VC) Dawn Capital and the VC divisions of Germany’s Commerzbank and US crypto billionaire Mike Novogratz’s Galaxy Digital.

The funding round valued Elwood at around $500 million and marked the first time that Elwood Technologies has obtained outside financing.

British hedge fund billionaire Alan Howard, founded Elwood Technologies with the initial aim of managing his personal fortune of digital assets.

Elwood has diverted from being asset management focused to selling market data, trading infrastructure and asset management software to clients who want to invest in digital assets since 2020.

It was reported by the Financial Times that the company’s CEO Strickland said that they provide a tech platform similar to Bloomberg’s widely used terminal and BlackRock’s portfolio management system “Aladdin.”

Elwood Technologies CEO James Strickland told the Financial Times that the success of the latest funding round, which comes regardless of the recent turmoil in crypto markets, is “another confirmation of the longevity of crypto.”

“We’re getting investment from financial institutions that aren’t expecting to get massive returns in 15 minutes,” he continued, adding that “I think it’s a reassurance message.”

Meanwhile, “as institutional demand for cryptocurrency rises, we have been actively broadening our market presence and capabilities to cater for client demand,” noted Goldman Sachs’ global head of digital assets Mathew McDermott. He said the latest investment in Elwood demonstrated the bank’s “continued commitment” to the digital asset space.

Fears about slowing global growth at a time when major global central banks are intent on aggressively lifting interest rates to tame rampant inflation have been cited as the main cause for the recent tumble.

Cryptocurrencies are still primarily viewed as risky and speculative assets, hence their susceptibility to risk-off flows. They are also (like precious metals) sensitive to rising interest rates, given that this marks an increase in the opportunity cost of holding non-yielding assets like crypto or gold.

investment in Elwood by Goldman and Barclays’ comes amid a broad trend of major financial institutions moving to fulfill the growing need for crypto trading and investment services from their clients.

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