CI Financial Corp. CIX-T is ratcheting up its interest in cryptocurrencies by acquiring a stake in Newton Crypto Ltd., a Toronto-based trading platform.
The investment giant announced Wednesday that it has acquired a minority stake in Newton as part of a US$20-million Series B funding round, which was completed Feb 4. The funding – which estimates Newton’s valuation at about US$200-million – was led in partnership with DV Chain, LLC. Other investors include Singh Capital Partners, Anthony Pompliano, Tiny Capital and Snowdevil Capital (founded by Shopify co-founder Tobias Lutke).
“We made this investment specifically to accelerate the timeline by which we can extend crypto trading capabilities to our wealth management clients,” CI president and chief operating officer Darie Urbanky said in a statement.
The financial terms of the deal were not disclosed.
CI manages about $384-billion and was one of the first investment managers to enter the cryptocurrency space, with the launch of the CI Galaxy Bitcoin Fund, a closed-end fund that began trading in December, 2020. The fund was later merged into the CI Galaxy Bitcoin ETF in March, 2021, after regulators approved bitcoin ETFs for retail investors.
The company later added an Ethereum ETF and a multicrypto ETF, as well as mutual fund versions for all three.
Launched in 2018, Newton provides a no-commission trading platform for Canadians to buy and sell more than 60 crypto assets on any mobile device or desktop, including bitcoin, ethereum and litecoin. The company said in a statement that the funding round will be used to further develop its technology, platform and infrastructure, as well as attract new talent in all areas of the company.
Mr. Urbanky said in an e-mail to The Globe and Mail that the company began to look for a partner because there has been a growing interest in cryptocurrencies. The investment in Newton, he said, will help provide clients with a “trusted and secure way to gain exposure to these new emerging asset classes.”
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Clare O’Hara