Markets
Zodia Markets agrees to buy Elwood Technologies trading desk
Zodia Markets, a cryptocurrency-focused trading firm backed by Standard Chartered’s venture arm, said it is buying Elwood Technologies’ over-the-counter trading division, confirming media reports. the unit was in the block It is sale negotiations were underway.
After divesting the business, Elwood, which was championed by pro-cryptocurrency billionaire Alan Howard, will focus on its trading technology software-as-a-service (SaaS) products and services, the company said on Monday.
Confidence is high in the institutional cryptocurrency space, with regulated projects backed by qualified banks and custodians building a foundation of trading infrastructure to meet the demands of traditional capital markets.
Zodia Markets’ OTC business now handles trading volumes of up to $60 million per day, according to CEO Usman Ahmad. He did not share details of how much client volume is likely to come to Zodia from the deal, but said in an email that the company expects to “significantly increase daily volumes.” He also declined to share the financial terms of the deal.
Standard Chartered, which was recently reported to enter the cryptocurrency spot trading space, is a sponsor (through its SC Ventures business) of Zodia Markets and its sister operation, Zodia Custody.
Usman said the deal would not overlap with Standard Chartered’s crypto trading aspirations. “This transaction is an enabler for the growth of Zodia Markets and does not overlap with what Standard Chartered may or may not do directly in spot crypto trading,” he said.
Cryptocurrency markets, emerging from a long bear market, remain volatile. Elwood CEO Chris Lawn said the decision to sell the OTC business was not about a bull or bear market, but rather an illustration of how the digital asset industry is maturing, with new entrants demanding institutional-grade SaaS solutions.
“Increased competition and M&A will force companies to ask tough questions about who and what they really are,” Lawn said in an email. “For us, the answer is that we are a technology company, hence the strategic decision to focus all our efforts on that part of our business and sell the OTC business.”