Anchorage Digital raises $350 million in latest funding round, led by KKR

FILE PHOTO: Representations of cryptocurrencies Bitcoin, Ethereum, DogeCoin, Ripple, Litecoin are placed on PC motherboard in this illustration taken
Representations of cryptocurrencies Bitcoin, Ethereum, DogeCoin, Ripple, Litecoin are placed on PC motherboard in this illustration taken, June 29, 2021. REUTERS/Dado Ruvic/Illustration//File Photo

December 15, 2021

By Gertrude Chavez-Dreyfuss

NEW YORK (Reuters) – Anchorage Digital, a digital asset financial platform, said on Wednesday it raised $350 million in its latest funding round led by private equity firm KKR & Co Inc.

The capital raised by the firm lifted its valuation to $3 billion. Based in San Francisco, Anchorage is a regulated platform that provides both prime services such as custody, lending, and trading, as well as infrastructure, which companies can use to build cryptocurrency products.

Goldman Sachs, Andreessen Horowitz, Apollo credit funds and Wellington Management, among other investors, also participated in the financing round, Anchorage said. Reuters confirmed their investment, which entitled them to an equity stake in the digital asset firm.

“We wanted to make sure that all these big investment names are in our corner because Anchorage is expanding really heavily toward larger financial institutions,” Diogo Mónica, president and co-founder of Anchorage, told Reuters in a phone interview.

Anchorage received its banking charter from the Office of the Comptroller (OCC) in January 2021.

Mónica also pointed out that the funds would be used, in part, to accelerate the company’s international expansion.

“We want to continue to expand internationally, ensuring that we not only have our regulated federal charter … but also get equivalent registrations in other countries,” he added.

Anchorage also said it plans to use this latest funding to enhance its infrastructure solutions, specifically for global financial firms and financial tech innovators.

KKR, in a statement, said it is investing in Anchorage through its Next Generation Technology Growth Fund II, a fund dedicated to growth equity investment opportunities in the technology space. This will be the firm’s first direct equity investment in a digital asset company, it added. 

The U.S. private equity firm also backed the flagship fund of ParaFi Capital, according to reports from Bloomberg and CoinDesk. ParaFi focuses on decentralized finance applications facilitating crypto-denominated lending outside traditional banking.

Anchorage’s latest funding followed a previous financing round that raised $80 million for the company. Its client base surged 96% this year.

(Reporting by Gertrude Chavez-Dreyfuss in New York; Editing by Matthew Lewis)