Standard Chartered Crypto Custody Raises $36M in Japan's SBI-Led Funding, Rules Out USA

Standard Charterd's crypto unit Zodia Custody has raised $36 million in new funding led by Japanese finance group SBI Holdings.

On Thursday, StanChart announced that its London-headquartered Zodia Custody has now been diluted. Prior to the Series A funding round, Zodia was backed solely by StanChart with 90% ownership and Northern Trust.

Zodia chief executive Julian Sawyer did not reveal the exact breakdown of the new ownership structure but confirmed that StanChart remains the unit's majority owner.

“It is part of our strategy to be bank-backed, and all the good things that that brings,” Sawyer said. “That doesn’t mean there has to be a single bank.”

Zodia Custody was established in late 2020 to target institutional investors.

Expansion, but not to US

Funds will go towards Zodia's expansion beyond its European and Asian markets, with an interest in the Middle East, and to onboard more digital assets to Zodia's portfolio including staked Ether.

However, Sawyer said Zodia is not looking to expand into the US due to “uncertainty in its regulatory roadmap.”

“As an industry there’s a challenge in terms of which regulatory body is managing crypto, and what assets are classed as securities,” he said.

“We hope the US creates that clarity, but at the moment, it’s fair to say that it’s difficult to see what that will be in the next 12 to 18 months.”

The US has intensified its scrutiny of the crypto space recently. SushiSwap, Coinbase, Binance, Ethereum, Do Kwon, and Justin Sun have found themselves in the crosshairs of US regulators.

Most recently, Binance CEO Changpeng Zhao reportedly hired a team of lawyers for himself and the exchange following lawsuits and investigations from the US Justice Department, CFTC and SEC.

The world of Web3 can be quite a whirlwind. Whether it’s crypto news in Singapore, South East Asia or even across the globe, we understand how busy the industry is keeping you, so we kindly send out three newsletters each week:

BlockBeat for a wrap-up of the week’s digital assets news
Blockhead Brief for weekend happenings as well as what to look forward to in the week ahead
Business Bulletin for macroeconomic updates and industry developments.

To avoid FOMO and access member-only features, click here to subscribe for FREE.