Barclays joins the list of major financial institutions exploring digital assets. The company reportedly acquired a stake in Copper, a cryptocurrency company. Copper is a business that also attracted former Chancellor of the Exchequer Philip Hammond.
Barclays to take stake in Copper
According to a Bloomberg report, an unnamed source said Barclays will be part of Copper’s funding round, where it will make a multi-million investment. Copper is a financial company that offers a wide range of services including custody, prime brokerage and settlement for institutional investors.
This is not the first time that a major financial institution has turned to cryptocurrencies. In the United States, banking giants such as JPMorgan and Goldman Sachs are also venturing into crypto offerings by providing their clients with access to crypto investments and custody services.
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Barclays’ move into crypto comes as the broader cryptocurrency market plunged due to increased selling pressure. The decline in value of several cryptocurrencies has caused several bankruptcies and millions of dollars in losses for investors.
Venture capital funding in crypto
The crypto bear market appears to be deterring investment from venture capitalists. In 2021, there was a lot of hype surrounding crypto, and many venture capital funds poured into the sector. During the first quarter of this year, crypto startups received $9.85 billion in venture capital funds.
The second quarter saw a notable decline in venture capital funding. $6.76 billion went to crypto companies in the last three months of June. This is the lowest level recorded in a year. Additionally, the cryptocurrency market shows no signs of recovery anytime soon, and the next few days could see increased layoffs and a drop in valuation.
Some venture capitalists have also been affected by the collapse of some projects. Mike Novogratz from Galaxy Digital suffered a massive loss after the Terra LUNA ecosystem collapsed. Novogratz, who even had a LUNA tattoo, said it would serve as a reminder that venture capital requires humility.
Binance CEO Changpeng Zhao also urged the crypto community to stay away from projects that need venture capital funding to survive. The advice follows the closure of some businesses due to a lack of funding and support from venture capitalists who are now withholding funds due to the crypto winter.
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