Despite the downturn in cryptocurrency value, a US crypto custody service is getting an astonishing $15,000,000 in funding from Goldman Sachs and Galaxy Digital.
The handsome amount invested by the colossal US bank and Galaxy Digital CEO Mike Novogratz in BitGo Holdings Inc. is an indication that the cryptocurrency industry will linger for many decades. The startup company has already accumulated a total of $57.5 million for its Series B fundraising. Goldman Sachs and Galaxy Digital’s recommendation with formidable Wall Street origin might help BitGo entice more business organizations and well-to-do stakeholders as customers.
The amount invested by Goldman Sachs can do the bank a favor to build cryptocurrency services of its own. It was also one of the firsts on Wall Street to accredit Bitcoin futures proposed in the late quarter of last year. Now, earlier this year, it designated a director of digital-asset markets as it discovered means to root for clients responsive in spending in crypto.
Novogratz, on the other hand, was a former macro trader and a business partner of Goldman Sachs. He has been one of Wall Street’s most distinguished campaigners and other digital equities. In September, he concluded on Fidelity Investments’ declaration to deliver a custody solution adapted to institutional investors noting that crypto custodians require supplementary evaluation before accomplishing mass awareness established on investor trust.
BitGo is a Palo Alto-based company in California and was established in 2013. It provides digital wallets which need several signatures for transactions. It also offers offline vaults for Bitcoin storage and other cryptocurrencies.
The acquisition of custodian Kingdom Trust in January did not become successful pushing BitGo to establish its own qualified custody business named BitGo Trust Co. The South Dakota Division of Banking granted BitGo a state trust company charter in September which made it as one qualified cryptocurrency custodian.
US watchdogs mandate huge money managers consign client assets to a particular authorized and capable custodian. Most of the time, custodians are industry stalwarts like Bank of New York Mellon Corp and State Street Corp. However, the primary reluctance of many traditional companies to accommodate digital currencies has barred key investors from the market.
BitGo CEO and co-founder Mike Belshe said, “No one is better positioned than BitGo to serve institutional investors who want to trade cryptocurrencies and digital assets. That’s why we’re focused on figuring out what it takes to secure a trillion dollars. The market’s not there yet but our job is to be ready first.”
BitGo has been regarded by hundreds of cryptocurrency exchanges worldwide and argues to obtain over $2 billion in wallet equities. It aims to raise $1 trillion with the help of Wall Street big shots. Digital currency supporters are hopeful that institutional-grade storage will entice more capitalists into the market.
According to Goldman Sachs’ Principal Strategic Investments MD, Rana Yared, it takes better institutional cooperation in the digital asset markets to obtain secure and controlled custody solutions. She added that the company perceives their investment in BitGo as a sensational moment to uphold to the development of the pivotal market infrastructure.