Anchorage Raises $350M to Expand Crypto Offerings

Share this article

Anchorage Digital has raised $350 million in a funding round led by KKR.

Anchorage Closes Series D Funding Round

U.S.-based digital assets firm Anchorage Digital has raised $350 million in a Series D funding round.

The firm shared details of the raise in a Wednesday blog post. It was led by investment company KKR, while Goldman Sachs, Alameda Research, Andreessen Horowitz, Apollo, and others also participated. The raise gives the firm a valuation of over $3 billion and follows a GIC-led $80 million Series C round, which took place in February 2021.

Diogo Mónica, the President and co-founder of Anchorage Digital, said of the raise:

“As more and more institutions look to add crypto services into their offerings, we find ourselves at an inflection point. This funding positions Anchorage Digital to meet the unprecedented institutional demand for this rapidly evolving market.”

Anchorage lets institutional players gain crypto exposure. It offers a range of services including custody, trading, and staking for crypto assets like Bitcoin and Ethereum.

Per the announcement, the firm plans to deploy the capital to expand its solutions catering to global financial and fintech companies. The freshly-raised capital will also be used to expand its team.

In January 2021, Anchorage made headlines when it became the first crypto firm to receive a banking charter from the Office of the Comptroller. It also helped Visa acquire its CryptoPunk NFT in August.

Anchorage’s funding news comes as vast sums of capital flood into the crypto space. Yesterday, NYDIG, another crypto firm targeting the institutional market, announced it had raised $1 billion in a funding round led by WestCap. The firm said it would use the funds to develop institutional-grade Bitcoin products.

Disclosure: At the time of writing, the author of this piece owned ETH and other cryptocurrencies. 

Share this article


Tagged : / / /

Digital Assets Bank Anchorage Unveils Ether-Backed Loans

Cryptocurrency bank Anchorage has unveiled ether-backed (ETH) loans for institutional investors.

ETH-Backed Loans are Here

In an announcement made yesterday, digital assets bank Anchorage stated it had launched Ethereum-backed loans via Anchorage Financing. This means that from now on, institutional clients at Anchorage will have access to a USD line of credit backed by Ethereum via the bank’s partnership with BankProv.

For the uninitiated, BankProv is the 10th oldest bank in the U.S. and has been in operation for more than 200 years as The Provident Bank prior to its rebranding in 2020.

Commenting on the development, Dave Mansfield, CEO, BankProv, noted:

“We’re pushing our full-service offering for the cryptocurrency community to the next level. We firmly believe in our mission and belief that the crypto market should be afforded the same access and rights to traditional financing tools as any other legal, well-capitalized and compliant business in America. Anchorage’s collateral management tech is world class, making them a trusted partner in the banking industry.”

Essentially, with this move, Anchorage Finance has made it easier for crypto-native funds who have investments in Ethereum and a need for capital to put their ETH to work and bring them USD to meet their needs without having to part away with their digital assets.

Rising Institutional Interest in Ethereum

While bitcoin has been the favorite of big institutions such as MicroStrategy, Tesla, among others, Ethereum is slowly catching up to the orange coin.

An increasing number of investors are slowly waking up to the multiple utilities of Ethereum which make ETH more useful than bitcoin which primarily aims to function as a store of value, and, to a lesser extent, as a medium of exchange.

In addition, the Ethereum protocol at large has been generating the most revenue among all blockchain protocols in existence today, which, in turn, adds to its network usage.

As previously reported by BTCManager, several nations are eyeing the second-largest cryptocurrency by market cap very closely including countries like the U.S., Germany, and Turkey.

At press time, ETH trades at $2,638 with a market cap of more than $305 billion.

Related posts:

Like BTCMANAGER? Send us a tip!

Our Bitcoin Address: 3AbQrAyRsdM5NX5BQh8qWYePEpGjCYLCy4


Tagged : / / / /

Digital bank Anchorage offers Ethereum-backed loans to institutions

Crypto custody bank Anchorage Digital is expanding its services into crypto-backed loans for institutional investors.

Clients at Anchorage can now access a line of USD credit backed by Ethereum through its partnership with U.S. commercial bank BankProv.

Anchorage Financing will introduce a simple way for investors to put their Ethereum holdings to work, enabling them to access USD to meet their needs without liquidating their holdings according to the announcement. The crypto custodian also offers staking services for additional yields on Ethereum

The digital asset bank holds on to the ETH, using it as collateral should a client be unable to repay the dollar loan. Clients with large ETH holdings will be able to access a larger line of credit. Anchorage already provides Bitcoin-backed loans through other capital providers.

Ethereum-backed loans may be under collateralized if the borrower passes appropriate risk due diligence checks according to Anchorage co-founder Diogo Mónica.

Dave Mansfield, CEO of BankProv, said that Anchorage’s collateral management tech is “world-class”, adding that it is a trusted partner to the banking industry:

“We firmly believe in our mission and belief that the crypto market should be afforded the same access and rights to traditional financing tools as any other legal, well-capitalized and compliant business in America.”

Anchorage was the first crypto firm to receive a charter from the U.S. national bank regulator in January 2021. BankProv is the tenth oldest bank in America, operating for over 200 years as The Provident Bank before a rebrand in 2020.

In late February, Anchorage raised $80 million in a Series C funding round led by GIC, Singapore’s sovereign wealth fund, with participation from Andreessen Horowitz, and Blockchain Capital. The funding helped the custodian to assist institutions by bringing crypto to their users and diversifying their corporate treasuries.

In late March, Anchorage teamed up with cryptocurrency trading platform Prometheum to launch a fully regulated alternative trading system, or ATS, tailed specifically for professional crypto investors.


Tagged : / / / /

Anchorage Becomes the First Digital Bank to Function As a Traditional Bank

Cryptocurrency startup Anchorage Hold LLC has received conditional approval from the US currency control office to become an official federal government bank.

Qualified Custodian for Institutional Investors

Anchorage, now officially known as the National Association of Anchorage Digital Bank, was the first cryptocurrency company to receive the Bundesbank charter. It is an essential milestone in cryptocurrency history adoption. The accord means that Anchorage is now the first authorized digital asset bank in the US to meet the same standards and approvals as traditional banks.

A national banking charter forms the Anchorage Digital Bank based on the same regulations as other national banks. The fastest way to get monitored services is a first for any traditional financial institution looking to provide its customers with digital assets access.

Although Anchorage does not seek to set up offices in the local environment, the charter allows the company to provide services such as trading and loans.

OCC said that in awarding this charter, OCC applies rigorous review and the same standards applicable to all charter applications. By introducing these candidates into the federal banking system, banks and industry will benefit from the OCC’s rich experience and expertise.

Anchorage was founded in 2017 and offered institutional investors a crypto native custody service for digital assets. The custodian holds client property or money on their behalf and is responsible for its financial products’ security. The company’s proposals have a design to help institutions better protect their investments while extracting more of their assets.

Future Partnerships With Anchorage

Crypto firms have long struggled to become qualified trustees in terms of how digital asset service providers can comply with aspects of the Securities Investor Protection Act of 1970 – specifically how brokers can demonstrate that no other entity can access them their own and have a private key.

In an interview with Forbes, McCauley said the charter would force hundreds of banks to partner with Anchorage to join the cryptocurrency boom. McCauley said that Anchorage allows all kinds of people to come to the table, even those who were reluctant to come. It represents a massive change in the availability of crypto assets.

Anchorage is co-founded by Diogo Mónica, and Nathan McCauley, former director of security at Docker Inc. It launched from stealth mode in January 2019 with a funding of $ 17 million.

The Anchorage Charter comes as the price for the Bitcoin-led cryptocurrency continues to move up, albeit at a cost that it would never have achieved a month ago. Bitcoin was trading at $ 37,489.81 at 9:55 p.m. EST after falling to $ 30,525.39 on January 11, after hitting a high of $ 41,528.79 on January 8.

Like BTCMANAGER? Send us a tip!

Our Bitcoin Address: 3AbQrAyRsdM5NX5BQh8qWYePEpGjCYLCy4


Tagged : / / / / / / /

Anchorage Becomes First OCC-Approved National Crypto Bank

Crypto custodian Anchorage has secured conditional approval for a national trust charter from the U.S. Office of the Comptroller of the Currency (OCC), making it the first national “digital asset bank” in the U.S.

The safekeeping, management and trading of digital assets have been regulatory stumbling blocks for large financial institutions – but those obstacles are gradually being removed. The OCC, a part of the Treasury Department charged with keeping banks safe but also competitive, has now issued three interpretative letters that lay the groundwork for banks to custody crypto, participate in blockchain networks and become payment providers using the tech.

“In granting this charter, the OCC applied the same rigorous review and standards applied to all charter applications,” the bank regulator said in a statement. “By bringing this applicant into the federal banking system, the bank and industry will benefit from the OCC’s extensive supervisory experience and expertise.”

“We are a national bank. The only difference is our business line, that we’re doing crypto assets versus doing other assets,” Anchorage President Diogo Mónica said in an interview. “The benefit of having a federally chartered bank is that it preempts all the state laws. The clarity of being regulated by the oldest regulator for banks in the United States … sends a very clear message.”

Acting OCC chief Brian Brooks, speaking at a public event earlier Wednesday, expressed his belief that banks and financial services more broadly will transition to being blockchain-based.

“I think what’s necessary is the creation of crypto banks that are able to hold stablecoins that reflect value of a fiat currency, but that doesn’t change the native asset, and you need to have real cryptocurrencies over here where they interact directly with each other, with no need to ever off-ramp,” Brooks said. “Fiat will ultimately be a legacy thing of the past.”

Application process

Anchorage’s trust company unit first applied for a national charter from the OCC last November, and it joins Kraken and Avanti in being crypto-native banks, although the latter two are special-purpose depository institutions organized under Wyoming state law. Fellow crypto startups BitPay and Paxos have also applied for federal charters through the OCC.

The new bank is being ushered in under the auspices of Acting Comptroller of the Currency Brian Brooks, who’s headed up the regulator since this past summer. It’s the capstone to a multi-month effort to bring the crypto industry closer to the traditional banking world.

“Blockchains, fundamentally, are banking because what they’re doing is allowing the transaction of value across networks,” Brooks said at Wednesday’s event. “They’re [just] doing it in an orthogonally different way.”

During his tenure, Brooks, the former general counsel of Coinbase, has expressed his view that crypto startups may be better regulated under a federal framework, rather than at the state level.

“We’ve had a dual banking system in this country for 150 years. There are many, many banks chartered by the states out there because it’s the right business model for what they’re focused on,” Brooks told CoinDesk in June. “If you’re focused on the local and regional business, it makes sense to have a state charter. If you’re focused on a national business, it probably makes more sense to have a national charter.”

Georgia Quinn, Anchorage’s general counsel, told CoinDesk the process of applying for a national charter was made easier by the fact that the startup was already operating as a registered trust company in South Dakota.

“We were already a state-chartered bank and so already had an operating history and a lot of the relevant procedures and policies in place so it wasn’t a de novo application, it was just the conversion of a state trust into a national trust,” she said. “I really can’t stress enough the advantage we had from already operating as a trust company.”


Granting crypto companies a bank charter has been a stated goal for Brooks since May, when the then–First Deputy Comptroller told an audience at CoinDesk’s Consensus: Distributed that in his view, “it looks a lot like crypto is banking for the 21st century.”

The advantages are clear: rather than require companies to apply for 49 state money transmitter licenses piecemeal, a national charter will allow businesses to operate throughout the country at once. 

It also lets Anchorage develop new services, Mónica and co-founder Nathan McCauley told CoinDesk.

“It means that there’s a crypto-native company that offers crypto services like lending, staking and now it’s allowed to actually be connected directly to the core of the financial system,” Mónica said. “We can go out and do all sorts of businesses, wrapped assets that financial institutions can do today, but backed by crypto assets.”

Anchorage stated in a blog post accompanying the announcement that its new federally chartered bank “unequivocally will meet the definition of Qualified Custodian.”

Qualified custodians are legal entities in the U.S. that maintain client funds and hold securities in specific, defined ways. Federal regulators like the Securities and Exchange Commission (SEC) can designate entities as qualified custodians, while state regulators cannot. 

Crypto companies have long had issues becoming qualified custodians, due to questions about how digital asset service providers can comply with aspects of the Securities Investor Protection Act of 1970 – specifically, how brokers can prove that no other entity has access to its own private keys. 

Mónica said any doubts around the management of cryptographic keys were now removed and this would pave the way for the largest, most risk-averse investors such as pension funds to enter the arena.

“Aside from crypto funds and hedge funds and VCs that are paid to take risk and to be on the bleeding edge, you have large institutions that are paid not to take risk,” Mónica said. “This means all of the doubts are now solved and in black and white.”

Kristin Smith, executive director of lobbying group the Blockchain Association, welcomed the news.

“Today’s announcement is a recognition that not only can banks engage with crypto, but that crypto companies can function as banks,” Smith said in a statement. “This is the most important step yet towards the full modernization of our financial services system.”

Out the door

The news comes as Brooks is rumored to be planning his departure from the federal regulator later this week. While Brooks has been nominated to serve a full term heading up the agency by President Donald Trump, it is expected that incoming President Joe Biden will pull the nomination.

There is already legislator pushback against many of the letters Brooks has overseen, with Rep. Maxine Waters (D-Calif.), the chair of the House Financial Services Committee, asking Biden to ensure his nominees revoke many Trump-era rules and regulations, including all of the OCC’s recent crypto guidance. 

A federal charter is one issue that would be more difficult for Brooks’ successor to overturn. 

It’s unclear who Biden will tap to lead the OCC. The President-elect has announced he will nominate former Federal Reserve Chair Janet Yellen to be Treasury Secretary. The Senate Finance Committee will hold a confirmation hearing for her on Jan. 19, a day before Biden is sworn in.

Yellen or Biden could designate an acting comptroller to lead the agency until someone is nominated to fill a full five-year term. Brooks was initially appointed to the OCC by current Treasury Secretary Steven Mnuchin.

Biden has reportedly nominated former Commodity Futures Trading Commission Chair Gary Gensler to lead the SEC, perhaps indicating that he may look for someone with less of a deregulatory focus. 



Tagged : / / / / / /

Anchorage Hires Celsius’ Asaf Iram as Head of Risk

Digital asset custodian Anchorage has nabbed a trade operations veteran from Celsius Network to manage the risks facing its $4 billion crypto vault.

The new hire, Asaf Iram, said he will “connect the dots” between Anchorage’s financing, lending, custody and staking businesses as the leadership team’s first “Head of Risk.” He told CoinDesk his focus will be on ensuring Anchorage’s customers feel safe about their assets, explaining to them the risks of deploying those assets across different lending pools, be they conservative, moderate or aggressive, Iram said.

Iram previously spent a year and a half managing the trade desk for crypto lender Celsius Network. He came to that role after nearly three years in the arbitrage trenches as a fulltime crypto trader. It was a passion project that Iram said inspired him to quit the Tel Aviv Stock exchange in 2017.

There he said he was also a financial risk manager. Iram said he helped his company, DAR Finance LTD, navigate risk across different traders. Iram himself also served stints as a high frequency trader.

Anchorage acquired data analysis firm Merkle Data early last year, saying at the time it would boost the firm’s risk modeling capabilities. In May company executives pledged that new products built on those capabilities were in the works.



Tagged : / / /
Bitcoin (BTC) $ 36,982.91 1.19%
Ethereum (ETH) $ 2,009.77 1.94%
Litecoin (LTC) $ 68.65 1.55%
Bitcoin Cash (BCH) $ 221.47 1.49%