Anchorage announced it has raised $350 million from asset management behemoth KKR, Goldman Sachs, and others, and its CEO predicts banks will begin offering crypto to customers by the end of 2022.
Anchorage reveals a $350 million funding round
Anchorage, a fast-growing crypto storage firm that received a federal bank charter in January, revealed a $350 million funding round led by asset management behemoth KKR, Goldman Sachs, and others. The Series D round valued the company at slightly more than $3 billion.
Anchorage CEO Diogo Monica told Decrypt that the Series D financing would be used to help its clients, who include large banks and enterprises, develop their crypto offerings.
“Institutions began to build products in 2020 that will come to market in mid-to-late 2022,” Monica predicted, predicting that banks will begin to offer crypto offerings to their customers next year, such as the ability to buy and sell Bitcoin.
If this happens, it will be a boon to Anchorage, which has used its federal bank charter to win contracts with banks and financial behemoths like Visa.
These contracts began as custody agreements in which the crypto storage firm stored digital assets, but have since expanded to encompass services such as staking, in which asset holders lock up coins and tokens in exchange for rewards.
New lines of business for Anchorage will arise
According to Diogo, custody now accounts for less than half of the company’s earnings as its staking and lending operations grow. Meanwhile, Diogo anticipates that new lines of business for the crypto storage firm will arise as banks seek to offer products such as DeFi-based yield packages.
Anchorage has also profited from the increased number of crypto assets that institutions are looking to park. Among these are NFTs, including a small number of Crypto Punks, that it is holding in custody for Visa and others.
The customer base of Anchorage has also expanded from private organizations to government bodies. In the previous year, the firm has expanded its custody clients to include the FDIC and the US Marshals Service.
Anchorage has stated that it has no plans to follow in the footsteps of cryptocurrency startups such as Coinbase and Robinhood by conducting an initial public offering.
According to Monica, the company’s balance sheet is in excellent shape—Anchorage has yet to spend the $80 million it raised in February—and the new Series D will give both a capital cushion and critical strategic partners.
Investors in the Series D round include Alameda Research, Andreessen Horowitz, BlackRock, Blockchain, Kraken, and PayPal Ventures, in addition to KKR and Goldman Sachs.
