Zodia Markets, Standard Chartered’s digital assets subsidiary, is reportedly in the final stages of acquiring Elwood Capital Management from hedge fund manager Alan Howard, according to Bloomberg sources. The Jersey-based firm is a subsidiary of his Elwood Technologies digital assets venture.
Zodia Markets launched in mid 2022 as a crypto brokerage and exchange. While it shuttered that platform earlier this year, the main bank is setting up a crypto trading desk.
Instead, Zodia Markets pivoted to focus on an over the counter (OTC) FX settlement solution for cross border payments involving stablecoins. Hence, it’s bridging Zodia’s position in the crypto market and Standard Chartered’s position as a global settlement bank. It trades $50-$60 million a day.
In April it partnered with CoinMENA to provide liquidity for OTC high-volume trades for G10 and gulf currencies against certain stablecoins.
This is where Elwood Capital Management fits in, as it offers an OTC trading and settlement service giving Zodia Markets a license as a virtual asset service provider and investment business in Jersey.
Meanwhile, Mr Howard has extensive crypto interests. During 2022 the Elwood Technologies group received a $70 million Series A funding co-led by Goldman Sachs. The UK’s Elwood Technologies is incorporated as a limited liability partnership which made $6.4 million in profit in the year to 31 March 2023. However, partners withdrew $23.3 million charged as an expense, with one partner taking $22.2 million – likely Elwood Technology Services controlled by Mr Howard.
Brevan Howard, the hedge fund he founded, also has a digital arm. However, while both Elwood and Brevan Howard are a little more focused on delivering services to the traditional finance sector, Mr Howard has a separate entity, WebN, a web3 fintech incubator.
