The financing of Citadel Securities Silicon Valley shows up when entering the cryptocurrencies

The financing of Citadel Securities Silicon Valley shows up when entering the cryptocurrencies

Citadel Securities LLC’s quest for Silicon Valley funding might be as much around extremely billionaire Ken Griffin’s firm at long last accepting digital currencies for all intents and purposes about fund-raising. Citadel Securities declared a $1.15 billion investment from Sequoia Capital and Paradigm, two venture capital firms with solid interests in crypto, suggesting Citadel Securities’ prospective entry into the field through associations that can help it to acquire ability.

According to a statement released on Tuesday, Huang said Paradigm is looking forward to ‘partnering with the Citadel Securities team as they extend their technology and expertise to even more markets and asset classes, including crypto.’ Sequoia Capital has entered the crypto market as well, funding a slew of firms centered on the ecosystem and underlying technology. According to those familiar with their plans, the cash injection might pave the way for an initial public offering.

In November, San Francisco-based Paradigm announced the launch of a record $2.5 billion venture capital fund aimed at crypto companies and protocols, while co-founder Matt Huang was previously a partner at Sequoia Capital and Fred Ehrsam, another co-founder, assisted in the founding of crypto exchange Coinbase Global Inc.

Jump Trading, Jane Street, and Hudson River Trading, among other Wall Street trading behemoths, have been major participants in crypto trading in recent years, applying their quantitative approach to a new market rife with volatility and inefficiencies. Jump, for example, provides free crypto trades for Robinhood Markets Inc. users and has developed its crypto division as it positions itself as a significant player in digital assets.

Griffin, on the other hand, has been a critic of the asset class, comparing it to ‘a jihadist call’ by people who don’t believe in the currency in October and said he doesn’t like the resources devoted to digital assets. Nonetheless, he said his firm would trade cryptocurrencies if they were properly regulated, and he applauded Securities and Exchange Commission Chair Gary Gensler for stepping up to the plate. According to a source familiar with the situation, the firm’s leaders are keeping an eye on whether digital assets and related technology can eventually undermine portions of its core trading business.

Coming Around

Citadel Securities is already under regulatory scrutiny due to concerns about payment-for-order-flow practices, which regulators believe may harm investors. According to James Angel, an associate professor of finance at Georgetown University, a foray into crypto would only enhance monitoring, despite the firm’s extensive expertise working with Washington regulators.

“Citadel Securities already has a good Washington presence. They’ve hired a lot of former government officials, they know what they’re doing in Washington and by moving into crypto they can actually use their regulatory expertise to stay out of trouble and actually make money in the crypto space,” Angel said. “You could argue that their regulatory situation actually gives them an advantage getting into crypto because they know what to avoid. They know what it’s like to live under the SEC microscope.”
Griffin outbid a group of crypto investors known as ConstitutionDAO for a copy of the US Constitution in November. He praised the organization for raising more than $40 million and stated that digital assets ‘speak to the ambition to change America.’ He’s also changed his mind about Ethereum, arguing that its blockchain would ‘conceptually’ replace Bitcoin.

“The train is, in some sense, still in the station,” Griffin said at a DealBook conference last year as he explained he isn’t worried he missed out on crypto. Tuesday’s declaration proposes he may be prepared to get on board.
Crypto Expertise According to its co-founder Huang, who spoke on Bloomberg’s Odd Lots podcast in December, Paradigm separates out from other investment firms by providing technical experience in the crypto area, as well as the ability to code or audit the codes of its portfolio companies. Dan Robinson, Paradigm’s head of research, is a co-author of the white paper for Uniswap V3, a key automated crypto market maker.

Huang was recently appointed to Stripe Inc.’s board of directors as the payment business looks into product development in conjunction with its newly formed crypto team. It’s notable, according to Ryan Selkis, founder and CEO of Messari, a crypto data, and research platform, that a crypto fund is investing in a traditional financial company. It’s a 180-degree turn from previous investment trends, and it could be a huge topic this year.

“As soon as legacy investors are able to make money from the crypto market, they will be more inclined to view these markets positively, and not want them heavily regulated or cracked down upon,” he said.
Citadel Securities believes the transaction will help it ‘become more competitive in a market that Jump and Jane Street have historically controlled,’ according to the company. Selkis remarked. The rapidly rising bitcoin business has resulted in a wealth boom for early adopters. According to the Bloomberg Billionaires Index, Changpeng Zhao, the creator of Binance, is worth $96 billion, just over four years after founding the cryptocurrency exchange. Ken Griffin, a prominent financier, is reported to have a net worth of $21 billion.

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