Series A funding round led by Tribe Capital and Social Capital
SFOX, a cryptocurrency prime dealer for high-volume traders and institutional investors, announced today that it has raised $22.7 million in Series A funding. The round was led by Tribe Capital and Social Capital, with participation from Y Combinator, Khosla Ventures, DHVC, Blockchain Capital, Upside Partnership, SV Angel, DCG, Mark Britto, and Airbnb Co-Founder Nathan Blecharczyk.
Founded in 2014, SFOX has established itself as the premier cryptocurrency prime dealer for large-scale investors such as funds, family offices, and high-net-worth individuals, with over $9 billion in transaction volume to date. SFOX, which has seen its client base grow 12-fold since the beginning of 2018 alone, enables institutions to trade high volumes without impacting prices by connecting them to a vast network of global cryptocurrency liquidity venues.
“The distributed nature of cryptocurrency has given rise to a large breadth of exchanges around the globe, creating a fragmented market and limited liquidity,” said Akbar Thobhani, CEO of SFOX. “Over the last four years, we’ve been able to provide our clients a single point of access and the best price execution by building the necessary smart routing technology to navigate and connect these global markets and exchanges.”
“Liquidity represents one of the most significant barriers to institutional cryptocurrency adoption,” said Co-Founder and Partner at Tribe Capital, Arjun Sethi, who will be joining SFOX’s board. “What has always excited us about SFOX and differentiates them from other players is that they provide access to a global integrated order book, sourced from exchanges, OTC desks, and market makers. This means institutions can trade from a single account and have the ability to buy and sell high volumes without impacting prices. This is exactly what institutional investors looking to embrace cryptocurrencies need today and in the future, as the ecosystem becomes more fragmented.”
With this round of financing, SFOX plans to expand beyond its position as a prime dealer for institutional investors by building out the rails and infrastructure to become the premier institutional crypto asset management platform. This will involve the delivery of a family of products that brings additional durability to crypto asset management, including advanced security and risk management products, additional infrastructure and support, and licenses to access new markets. SFOX believes these offerings will create new untapped opportunities for institutional investors.
“We’ve seen high interest from our clients in expanding their exposure to crypto assets,” said Akbar Thobhani. “Institutions need a full service asset management platform that meets the unique needs of cryptocurrency. This is not being fulfilled by traditional tools and current platforms. We’re in a great position to provide these rails. This investment will allow us to pursue this evolution.”
“We continue to observe sustained and increasing demand from institutions that want to include cryptocurrencies as part of a diverse portfolio but are reluctant to do so because of uncertainty and volatility,” said Arjun Sethi. “SFOX is the answer to these concerns.”