Banking giants Goldman Sachs and Britain’s Barclays have joined a $70 million Series A funding round for institutional crypto trading platform Elwood Technologies, founded by billionaire British hedge fund manager Alan Howard.
The round was joined by crypto-friendly German bank Commerzbank, crypto investment manager Galaxy Digital, and Dawn Capital, the Financial Times reported on May 15. The fundraising round valued the company at around $500 million, according to the report.
Despite the recent decline in crypto markets, Elwood said traditional financial institutions like hedge funds and banks will remain interested in investing in cryptocurrencies. Elwood’s funding round was already agreed and underway before the recent price drop since March 9, according to CoinMarketCap.
James Stickland, CEO of Elwood Technologies, said the fundraising was “further confirmation of crypto’s longevity” to dismiss the falling prices of the past few weeks:
“We receive investments from financial institutions that don’t expect to see massive returns within 15 minutes. They’re investing in infrastructure, I think that’s a reassuring message.”
Elwood Technologies provides a crypto portfolio management system with crypto market intelligence and trading infrastructure for institutional investors that has an interface that connects to crypto exchanges, liquidity providers and custodians.
Commenting on the deal, Mathew McDermott, Goldman Sachs’ global head of digital assets, said the investment shows the company has “continued commitment” to cryptocurrencies, adding:
“As institutional demand for cryptocurrency increases, we have been actively expanding our market presence and capabilities to meet client demand.”
The funding from Goldman Sachs marks the bank’s continued expansion into crypto assets. The investment bank was the first to offer a Bitcoin (BTC)-backed loan to crypto exchange Coinbase in early May. There has long been interest in this space, even dubbing digital assets and the metaverse as “megatrends” in March.
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Another case in which the Wall Street giant snuggled up to crypto firms was a meeting between Goldman CEO David Solomon and FTX chief Sam Bankman-Fried, which included an offer from Solomon to support FTX on future funding rounds and regulatory compliance regulations to help.
Elwood Technologies will remain majority owned by Alan Howard, who was the lead investor prior to the Series A round. Howard co-founded hedge fund Brevan Howard, which launched its crypto investment division, BH Digital, in September 2021.