London-based bitcoin firm B2C2 announced on Wednesday that it is selling stakes worth $30 million to SBI Holdings, Inc.
The FCA-approved crypto business confirmed that it would provide liquidity to SBI. The fintech giant wants to expand its cryptocurrency offerings to its millions of customers.
The partnership also expects to assist B2C2 as the award-winning bitcoin business builds an automated financing facility.
B2C2, a London-based bitcoin firm, is partnering with financial giant SBI Holdings via a deal that expects to benefit both the companies.
Expanding Prime Brokerage Solutions
The institutional cryptocurrency trading platform announced on Wednesday that it will sell a minority stake worth $30 million to SBI. The company called the partnership “strategic,” explaining that it would make B2C2 the prime crypto liquidity provider to SBI’s crypto services in Japan.
The partnership will accelerate SBI and B2C2’s expansion in the crypto and financial markets, writes @maxboonen https://t.co/RTfI0U4OBf#cryptotrading #liquidity #automation #innovation #fintech pic.twitter.com/BaXBYWxwHm
— B2C2 (@B2C2Group) July 1, 2020
In return, B2C2 will receive assistance from SBI’s strong distribution network and financial foothold. The U.K. bitcoin firm will build an electronic prime brokerage. It noted that SBI would provide them with top-grade lending and custodial solutions.
The new capability expects to enhance B2C2’s existing financial operations, which includes the loaning of hundreds of millions of dollars. The company also plans to launch “a fully automated facility to provide the most competitive two-way prices in the funding market” in the coming weeks.
“B2C2 will benefit from SBI’s balance sheet, which is far larger than anything committed to the crypto market to date,” said the bitcoin company’s founder Max Boonen in a press statement.
Preparing Grounds for Bitcoin Adoption
The latest partnership between B2C2 and SBI Holdings points to an emerging buzz word in the global financial market. It is “crypto-prime brokerage,” firms that assist institutional investors by financing and facilitating their trades.
It is no coincidence that three major bitcoin companies – Coinbase, Genesis Trading, and BitGo – in late May concurrently announced their plans to become prime brokerage service providers. All the crypto firms entered strategic partnerships with existing brokerage services.
It helped them solidify their balance sheets so they can perform the prime functions of loaning, clearing, and custody.
Institutional investors expect higher capital efficiency leverage. They also require solutions concerning netting, custody, and frictionless access to other financial products. On the other hand, an average Bitcoin investment firm typically lacks such services.
Therefore, the B2C2-SBI partnership paves the way for institutional investors to trade cryptocurrencies on familiar grounds. That is especially noteworthy in times when people are looking for investment alternatives beyond low-yielding government bonds and delusionally bullish stocks.
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