Standard Chartered’s crypto-custody arm raises $36 million

Standard Chartered’s crypto custody subsidiary Zodia Custody has raised $36 million in a Series A round, according to Bloomberg.

Previously, the London-based custodian was owned exclusively by the bank (90%) and the financial services provider Northern Trust. Zodia Custody’s CEO Julian Sawyer declined to disclose the post-round ownership structure, but noted that Standard Chartered remained the majority shareholder.

The financing included the bank’s venture arm SC Venutres and the Japanese financial group SBI Holdings. The latter became the second-largest owner of Zodia Custody, Sawyer said.

In February, the firm formed a joint venture with the holding company in Japan.

The firm will deploy the funds to expand beyond its current markets in Europe and Asia. According to Zodia’s head, the firm is exploring business opportunities in the Middle East. However, the United States is not currently in its near-term plans due to regulatory uncertainty.

“There is a problem in the industry over which regulator oversees cryptocurrencies and which assets are classified as securities. We hope the United States will provide clarity, but for now it is hard to know what will happen in the next 12–18 months,” Sawyer emphasised.

Zodia is also using the raised capital to expand the range of supported digital assets, the over-the-counter settlement network and add services, including staking Ethereum. This service has seen demand in the market following the activation of the Shapella hard fork, the head of the firm noted.

Zodia Custody was launched as a platform for institutional investors in late 2020.

In 2021, the bank’s custodian obtained a licence from the UK Financial Conduct Authority.