Apollo strikes crypto deal with Anchorage in digital asset push
Asset management giant Apollo has begun holding crypto on behalf of its clients after striking a deal with digital asset bank Anchorage Digital, in a vote of confidence in the future of crypto after a rocky few months in the market.
Anchorage, which provides secure storage of digital assets for institutional investors, said the partnership with one of the world’s biggest asset managers was “validating” today as the sector faces a crisis of confidence from investors in recent months.
The most valuable cryptocurrency Bitcoin has plunged more than 50 per cent since the start of 2022 as inflation and the ripples of war in Ukraine batter markets and cause inventors to pull back from riskier assets. The industry has also been hit by a string of high profile bankruptcies as punters have scrambled to pull their cash out of the market.
But in a statement today, Anchorage co-founder and president Diogo Monica said the partnership would prove the worth of digital assets to institutional investors.
“Apollo is a leader in the alternatives industry, so their use of Anchorage’s custody platform is incredibly validating, and we expect this collaboration can set the bar for how institutions work with regulated digital asset banks like Anchorage to provide custody and other services for their crypto holdings,” he said today.
“Being both nimble and secure with digital asset portfolios doesn’t have to be mutually exclusive–and we are confident this partnership will prove that.”
Apollo said today it had been drawn to Anchorage because of its “strict regulatory oversight” and emphasis on security.
US-based Anchorage is a regulated platform and houses the first “federally chartered crypto bank” in the country. It already looks after funds from major investors including Singapore’s sovereign wealth fund, Goldman Sachs, KKR, and Visa.
The move marks a major push from one of the world’s top investment managers into the crypto industry and will be seen as a boon to the acceptance of crypto as an asset class by mainstream financial institutions.
Apollo manages around $513bn dollars for its clients and has previously invested in Anchorage in a Series D funding round. The firm declined to share what assets it holds in an interview with Reuters.
Top investors have been doubling down on their commitment to the long term future of crypto in recent months despite a so-called crypto winter shaking over a trillion dollars in value out of the market.
BlackRock, the world’s biggest asset manager, revealed it has signed a partnership with crypto bourse Coinbase in August to ease the way that big institutional investors can buy and track Bitcoin.
The deal came in spite of sceptical comments by BlackRock chief Larry Fink in 2017 who said Bitcoin simply showed “how much demand for money laundering there is in the world.”