Venture capital firms Paradigm Capital and Sequoia Capital have agreed to invest $1.15 billion in electronic trading giant Citadel Securities, Citadel announced on Tuesday.
- The move brings Citadel Securities closer to crypto, as Paradigm focuses on investing in crypto and Web 3-related firms. Pardigm was co-founded by Fred Ehrsam, a co-founder of Coinbase, and Matt Huang, who previously led crypto investments at Sequoia.
- “We look forward to partnering with the Citadel Securities team as they extend their technology and expertise to even more markets and asset classes, including crypto,” Huang said in a statement.
- Citadel Securities, a sister company to the hedge fund behemoth Citadel founded by billionaire Ken Griffin, was founded in 2002 and now handles about 27% of the shares that are traded in the U.S. stock market each day, according to its website. Griffin is chairman of Citadel Securities.
- A large part of that volume comes from processing trades for online brokerages such as Robinhood, according to the Wall Street Journal, which first reported news of the investment.
- Citadel Securities has thus far avoided trading cryptocurrencies because of what Griffin has called regulatory uncertainties around them, according to a recent Reuters report.
- The investment values Citadel Securities at roughly $22 billion. Following the funding round, Sequoia partner Alfred Lin will join the Citadel Securities board of directors.
- Griffin was the winning bidder in a recent Sotheby’s auction for a rare copy of the U.S. Constitution, beating out the ConstitutionDAO group. Griffin reportedly intends to donate the document to a museum.
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