Goldman Sachs and Barclays, the two banking giants, have joined a $70 million Series A funding round for the institutional crypto trading platform Elwood Technologies, founded by billionaire British hedge fund manager Alan Howard.
It has been reported that joining the round was crypto-friendly German bank Commerzbank, crypto investment manager Galaxy Digital and Dawn Capital, as reported by the Financial Times on Sunday. The fundraising round valued the company at around $500 million.
However, despite the recent fall in crypto markets, Elwood said it’s betting that traditional financial institutions such as hedge funds and banks will still be interested in investing in cryptocurrencies. Elwood’s funding round was already agreed to and in motion before the latest drop in prices, which has seen roughly 15% wiped off the total crypto market cap since May 9, according to CoinMarketCap.
James Stickland, the CEO of Elwood Technologies, said that the fundraising was “another validation of the longevity of crypto” brushing off the falling prices from the last few weeks.
“We’re getting investment from financial institutions that aren’t expecting to get massive returns in 15 minutes. They’re investing in the infrastructure, I think it’s a reassurance message.”
The report said that Elwood Technologies provides a crypto portfolio management system with crypto market information and trading infrastructure for institutional investors that features an interface that connects to crypto exchanges, liquidity providers, and custodians.
Mathew McDermott, the Global Head of Digital Assets at Goldman Sachs, said:
“As institutional demand for cryptocurrency rises, we have been actively broadening our market presence and capabilities to cater for client demand.”
Likewise, the funding from Goldman Sachs marks the bank’s further expansion into crypto assets. The investment bank was the first to offer a loan backed by Bitcoin (BTC) to crypto exchange Coinbase in early May. It has long seen an interest in the space, even referring to digital assets and the Metaverse as “megatrends” in March. Another case of the Wall Street giant cozying to crypto firms saw a meeting between Goldman CEO David Solomon and FTX CEO Sam Bankman-Fried, which included an offer from Solomon to help FTX with future funding rounds and regulatory compliance.
Thus, for Elwood Technologies, it will remain majority-owned by Alan Howard, who was the main investor before the Series A round. Howard co-founded the hedge fund Brevan Howard which launched its crypto investment division BH Digital in September 2021.