Citadel Securities, Credit Suisse and Deutsche Bank are investing millions in crypto infrastructure projects

Editor’s Note: With so much market volatility, stay tuned for daily news! Get caught up in minutes with our quick summary of today’s must-read news and expert opinions. Sign up here!

(Kitco News) Major financial institutions appear to be unaffected by the ongoing struggles in the cryptocurrency market as Tuesday brought news that some of the biggest players in the game, including Citadel Securities and Susquehanna Advisors Group, have bought shares in Silvergate Capital, a stake. company that specializes in providing crypto banking services.

Citadel Securities, an established market maker, disclosed in a Securities and Exchange Commission (SEC) filing in December that it has purchased a 5.5% stake in Silvergate Capital (SI). According to the filing, Citadel now owns approximately 1.73 million shares of Silvergate, valued at approximately $26.5 million based on the current SI price of $15.30.

After the Citadel investment was disclosed, Susquehanna Advisors Group also reported a 7.5% stake in the crypto-friendly bank, representing 2.36 million shares worth approximately $36.1 million.

The struggles Silvergate has faced in recent months have been well documented as the bank has had to fight to stay solvent after receiving more than $8.1 billion in customer withdrawal requests during the fourth quarter of 2022, resulting in a loss of $718 million . To reduce operating costs, the bank laid off 40% of employees and was forced to liquidate debts.

Following the disclosures by Citadel and Susquehanna, the price of SI rose 18.15% from Monday’s close of $14.71 to a daily high of $17.38, but has since retreated to $16.40. SI is currently one of the most shorted stocks on Wall Street, and was the most shorted on January 31.

Investment in blockchain infrastructure

Across the Atlantic, Credit Suisse ( CS ) and Deutsche Bank ( DBK ) have also waded deeper into crypto waters through their participation in a $65 million Series B funding round for Geneva-based Taurus Technology, a provider of digital asset infrastructure for European financial institutions .

According to the Taurus announcement, the firm plans to use the funds to support its growth strategy, which includes hiring top engineering talent and maintaining “the most stringent security, risk and compliance requirements across product lines, processes and organizations.”

The firm also plans to use the funds to expand its presence across Europe and the United Arab Emirates and has future plans to expand into the Americas and Southeast Asia.

Some of the other institutional investors that participated in the Series B funding round for Taurus include Pictet Group and Cedar Mundi Ventures, while Series A investors include Arab Bank Switzerland and Investis, a listed Swiss real estate group.

Taurus specializes in providing custody, tokenization and trading of digital assets, including support for staking and decentralized finance (DeFi). The firm recently made headlines when it helped independent Swiss private bank Cité Gestion tokenize its shares, becoming the first private bank to tokenize its own shares under Swiss law.

These latest funding rounds show that despite the struggles that the crypto industry continues to face, there is still plenty of capital from major financial institutions ready to be invested in promising blockchain offerings, especially for projects that provide infrastructure for the broader digital asset ecosystem.