Standard Chartered’s Zodia Custody is raising $50 million to expand its crypto custody services amidst increasing competition from both traditional finance and crypto-native firms.
Standard Chartered's Crypto Custody Unit Seeks $50 Million
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Institutional Investors Drive Demand for Crypto Custody
Standard Chartered’s crypto custody business, Zodia Custody, is reportedly in talks to raise $50 million to fund its expansion into new markets. CEO Julian Sawyer said that, unlike past funding rounds involving wholesale financial institutions, Zodia will seek investment from angel investors, tokenization, and payments firms.
Architect Partners, a crypto-focused advisory firm, is said to be helping Standard Chartered’s custody business secure the funding. Previously, Zodia raised $36 million in a Series A funding round led by SBI Holdings, which became the second-largest shareholder after Standard Chartered.
Zodia’s search for new funding comes as the crypto custody industry becomes increasingly competitive. Both traditional financial institutions and digital asset companies are offering custody services. Major traditional banks like BNY Mellon, State Street, and Citigroup have entered the market alongside established crypto players like Komainu.
The growing demand for secure custody solutions is driven by institutions seeking exposure to cryptocurrencies, which are still perceived as risky due to increasing cyberattacks and significant asset losses.
With more institutional players expected to seek exposure to cryptocurrencies in the coming years, demand for custody services is expected to grow. This is prompting firms like Zodia to target new markets and launch new products.
However, despite becoming an important part of the digital asset ecosystem, crypto custody businesses face certain disadvantages that may deter some users. Fees associated with custody services and regulatory uncertainty are some factors impacting the growth of custody businesses.
