abrdn has become the latest asset manager to put money into digital assets, concluding a deal to become the largest external shareholder in Archax, a digital securities exchange.
Archax, which is founded by former hedge fund executives, provides a platform for institutional investors to trade cryptocurrencies and tokenised securities, including fractions of shares.
The firm was established four years ago and is the first and only digital securities exchange that has gained FCA permissions covering trading, custody and brokerage. The exchange will launch later this year.
In time, the asset manager will use the exchange to grant clients access to its funds in tokenised form and assets that are less easily tradeable such as private debt, private equity and buildings.
The FT, who first reported the deal, said the stake will allow abrdn to have a seat on the board of Archax.
abrdn CEO Stephen Bird commented: "Blockchain technologies are inevitably going to form a big part of the future of financial markets. There is the potential to offer greater transparency, greater speed and less trading friction by using these nascent digital technologies.
"Archax is one of the most promising UK players in this next expected high growth area in finance - the use of digital and tokenised securities with same-day settlement. In that sense, the growth of the digital investment market is about much more than cryptocurrencies.
"With Archax, we will have a meaningful footprint in this fast-developing market - which is likely to evolve in a multitude of different ways that are relevant to our core businesses. 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."
The deal comes just a week after BlackRock announced its partnership with Coinbase. On Thursday (11 August) the company announced plans for a bitcoin trust for institutional investors.
