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Standard Chartered’s Zodia secures $36 million in funding, signaling positive outlook on cryptocurrency.
Global financial institutions are increasingly enhancing their cryptocurrency-related offerings, with the British multinational bank Standard Chartered securing additional funding for its crypto platform Zodia.
Zodia Custody, the crypto custody subsidiary supported by Standard Chartered, has successfully raised $36 million in a new Series A funding round, as reported by Bloomberg on April 27.
The fundraising effort was spearheaded by Japanese financial conglomerate SBI Holdings, which has now become Zodia’s second-largest shareholder, according to statements from Zodia Custody CEO Julian Sawyer.
Before this funding round, Zodia, headquartered in London, was solely backed by Standard Chartered and Northern Trust, with Standard Chartered holding a 90% ownership stake in the company. Following the fundraising, it continues to be the majority shareholder, as noted by Sawyer.
The CEO of Zodia highlighted that it is common for Standard Chartered’s investment strategy to seek external funding once a subsidiary reaches a certain growth stage, stating:
“It is part of our strategy to be bank-backed, and all the good things that that brings,” he said. “That doesn’t mean there has to be a single bank.”
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With the newly acquired funding, Standard Chartered’s Zodia intends to broaden the range of supported cryptocurrencies, including staked Ether (ETH).
The company will also allocate the newly raised capital for geographic expansion beyond its current markets in Europe and Asia. It is particularly focused on opportunities in the Middle East but plans to avoid the United States due to regulatory ambiguities.
According to Sawyer, there is a significant lack of clarity regarding which cryptocurrencies should be classified as securities in the United States. “We hope the U.S. creates that clarity, but at the moment, it’s fair to say that it’s difficult to see what that will be in the next 12 to 18 months,” the CEO remarked.
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This announcement follows Zodia’s expansion into Japan through a joint venture with SBI Holdings in February 2023. Similar to the global Zodia division, its Japanese counterpart focuses exclusively on institutional investors. The joint venture is comprised of 51% ownership by SBI’s crypto entity SBI Digital Asset Holdings and 49% by Zodia Custody.
Standard Chartered, one of the largest banks in the United Kingdom, initially revealed plans to offer institutional custody for cryptocurrencies such as Bitcoin (BTC) back in 2020. Launched in 2021, Zodia has withstood the crypto bear market of 2022 and significant industry downturns like those of FTX and Celsius.
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