(Bloomberg) -- Standard Chartered Plc’s digital assets storage business Zodia Custody Ltd. is in talks to raise a fresh round of capital, as competition heats up in the growing market for crypto safekeeping.
The custodian is looking to secure $50 million from investors to fuel its plans to branch out into new geographies and expand its range of products, Zodia Custody Chief Executive Officer Julian Sawyer told Bloomberg News in an interview.
While Zodia is currently backed by several wholesale financial firms, it now hoping to tap a more diverse array of investors including payment and tokenization companies, Sawyer added. Architect Partners, an advisory firm focused on crypto, is assisting with the effort which began last month, he said.
Architect Partners did not respond to a request for comment.
The crypto custody landscape is made up of a mix of players whose roots lie in digital assets, such as Coinbase Global and Anchorage Digital, as well as traditional financial services firms that have broadened their capabilities. As more institutional players launch crypto products and services, competition among custodians is ramping up.
Bank of New York Mellon Corp., State Street Corp. and Citigroup Inc., some of the largest custodial banks in the world, have made initial forays into crypto custody or have expressed interest. Komainu Holdings Ltd., a crypto custody firm backed by Nomura Holdings Inc., recently signaled that it expects to close a funding round in the coming weeks, after acquiring a Singapore-licensed rival named Propine Holdings Pte Ltd.
Custody is seen as a growth area for startups and some Wall Street banks because cryptocurrencies are under constant siege by cyber-criminals, whose exploits cost the industry an estimated $1.8 billion last year, according to Immunefi, a bug bounty platform.
Zodia raised $36 million in a round led by SBI Holdings in April 2023. Its backers also include National Australia Bank Ltd. and Northern Trust Corp. It is majority-owned by Standard Chartered and shares a name with Zodia Markets, a digital-asset trading business that also counts the bank as its majority-shareholder.
©2024 Bloomberg L.P.