Scottish asset manager Abrdn has bought a stake in the UK’s first regulated crypto trader Archax in a major vote of confidence in blockchain technologies and cryptocurrencies.
The acquisition, for an undisclosed sum, will see Abrdn become the crypto startup’s largest external shareholder, the crypto firm said in a statement.
Launched in 2018, Archax is currently the first and only firm that has gained approval to launch a digital securities exchange from the UK’s Financial Conduct Authority (FCA).
The crypto trader is set to launch its own exchange later this year, with a view to acting as a bridge between cryptocurrency markets and traditional institutional investors.
The deal comes as a vote of confidence in blockchain in the midst of a recent downturn in crypto markets that has seen the value of Bitcoin and other major cryptocurrencies plummet.
In a statement, Abrdn chief executive Stephen Bird said the deal will give the 197-year-old asset manager “meaningful footprint” in the “fast-developing market” for blockchain technologies.
“This investment not only provides an opportunity for substantial financial benefits, it also creates a partnership with some of the leading thinkers in an area that has the potential to play a substantial role in the future of finance,” Bird said.
“Blockchain technologies are inevitably going to form a big part of the future of financial markets,” Bird added.
“There is the potential to offer greater transparency, greater speed and less trading friction by using these nascent digital technologies.”
First established in 1825, Edinburgh headquartered asset manager Abrdn currently controls more than £465bn in assets.
Archax CEO Graham Rodford said the deal comes as a “massive statement of belief in what we have built at Archax, as well as being a key milestone in our evolution and for the digital/tokenised world as a whole.”
“We look forward to working with abrdn closely to provide a new universe of users with access to our services, as well as creating new innovative tokenised products that will trade on our marketplace,” Rodford said.