JPMorgan takes stake in SoftBank, Goldman-backed blockchain startup

JPMorgan has taken a stake in Blockdaemon, a blockchain infrastructure startup that also includes SoftBank, Goldman Sachs and crypto exchange Kraken among its investors.

The Wall Street bank joined venture capital giant Tiger Global in taking an interest in the business this month, Blockdaemon said on 17 November, as part of JPMorgan’s expansion plans for the technology behind cryptocurrencies such as bitcoin.

“Making a strategic investment in Blockdaemon is a logical next step in our multi-layered approach to investing in blockchain technology and we’re pleased to participate in the funding round as they continue to grow and scale their business,” said Umar Farooq, chief executive of JPMorgan’s blockchain unit Onyx.

It comes as the US lender has doubled down on investing in distributed ledger technology this year, having increased its hiring in the sector by 82% over the last eight months. The size of its Blockdaemon investment was not disclosed.

READ JPMorgan leads Wall Street banks in blockchain hiring craze

Cryptocurrency prices have soared over the past 12 months as banks and institutional investors sought ways to access the asset class. JPMorgan, Goldman and Morgan Stanley are among those to consider offering crypto trading to clients, making a significant investment in building digital assets teams.

Blockdaemon, which is used by exchanges and banks to manage blockchain infrastructure on behalf of commercial clients, said it averages more than $10bn in monthly staked assets. It was last valued at $1.3bn in September, having raised roughly $190m from investors to date.

The California and Ireland dual-headquartered startup plans to expand its presence in the UK, Germany, Singapore and Japan in the coming months. Blockdaemon also announced on 17 November that it will soon move into non-fungible tokens after acquiring German startup Anyblock Analytics.

READ Europe beats US and China in luring pro traders to crypto

Blockdaemon chief executive and founder Konstantin Richter said the firm’s “robust” infrastructure was “making it easier for banks and other institutions to tap into the crypto universe”.

“We are pleased to have Tiger Global and JPMorgan join as strategic investors as we continue to power the blockchain economy around the world,” he added.

To contact the author of this story with feedback or news, email Emily Nicolle

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