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With the SBI investment, Zodia Custody will increase its Japan presence amid increased demand for digital assets from institutional investors in the country.
Zodia Custody, an institutional-grade crypto asset custodial platform backed by Standard Chartered in association with Northern Trust, has announced that it raised approximately $36 million led by Japanese financial conglomerate SBI Holdings. The London-headquartered crypto startup announced that the funding round also saw participation from SC Ventures, Standard Chartered’s venture arm. As a result, SBI Holdings is now the second-largest shareholder in Zodia Custody after Standard Chartered which owns the majority.
According to the startup, the funds are expected to be channeled to help increase its crypto token coverage and enhance its settlement product, Interchange, which protects clients’ assets that are traded on exchanges. With the SBI investment, Zodia Custody will increase its Japan presence amid increased demand for digital assets from institutional investors in the country.
“The future direction of the digital asset ecosystem is clear,” CEO Julian Sawyer said. “As investors demand greater assurance and rigour, compliance is crucial to the future evolution of our sector.”
Moreover, there is a reported increase in demand for crypto assets in East Asia with Hong ready to enact digital asset’s friendly regulatory framework. Additionally, the European Union recently passed the Markets in Crypto Assets (MiCA) regulation, a comprehensive framework to regulate the issuance and servicing of most crypto assets in the region. As a result, the emergence of institutional-grade crypto custodial services is imminent before the next crypto bull market.
Meanwhile, Zodia intends to expand its services to global markets as it waits for the United States to enact friendly crypto regulations.
“As an industry, there’s a challenge in terms of which regulatory body is managing crypto, and what assets are classed as securities,” Julian added. “We hope the US 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.”
Zodia Custody and the Crypto Market Outlook
Established in 2020, Zodia Custody is well-positioned to attract institutional investors from all over the world. More so now that there is an increased risk of the American banking system collapse. With a looming recession, forecasted to hit major markets by the second half of this year, digital assets have been viewed as a better hedge against inflation. Moreover, the industry is about a year away from the historical halving event that triggers major crypto bull markets.
Reportedly, Zodia intends to further venture into the second-largest digital asset market, Ethereum, through its staking program. Moreover, the Shanghai upgrade enabled withdrawals of staked ethers, thus welcoming more institutional investors.
Currently, Zodia offers custody services for Bitcoin, Ether, Bitcoin Cash, Litecoin, Chainlink, Uniswap, Wrapped Bitcoin, and USD Coin.