Securitize, a firm known for bringing private investments onto the blockchain, is set to acquire crypto investment platform Onramp Invest.
OnRamp's 18 employees will join Securitize, which stands at 150 staff, according to The Information. The firm, backed by Coinbase Ventures and Blockchain Capital, has raised more than $120 million in capital.
The deal — which comes amid a broader slump in deal-making activity — was born out of an existing business relationship between the firms and a difficult fundraising environment in crypto, according to Onramp COO Ashton Chaffee. OnRamp provides a platform for financial advisors to offer crypto exposure to their clients.
Securitize, meanwhile, works with large investment firms like Hamilton Lane and KKR to tokenize private investments. It made headlines in September 2022 for a deal with private equity firm KKR to tokenize an alternative investment fund. Advocates of tokenization claim that moving such investments onto public chains enhances liquidity and transparency for investors.
Following publication, Securitize told The Block in an email that the acquisition will provide registered investment advisors with access to alternative asset classes via Securitize's portfolio of private credit, private equity, and other assets.
“Our acquisition of Onramp is another big step forward in expanding investor access to top-performing alternative assets and in democratizing private capital markets. Onramp already offered RIAs easy access to digital assets, so it is a very natural extension to offer them tokenized alternative assets to complement their portfolios,” said Securitize CEO Carlos Domingo. “Most wealth is generated in private market alternative assets and bringing Securitize and Onramp together enables registered investment advisors to give their clients access to that wealth generation.”
M&A cool down
Crypto deal-making has slowed amid a broader global mergers-and-acquisitions slump. As noted by Axios's Dan Primack, deal-making activity was catatonic during the first half of the year, with data from Refinitiv showing that global M&A during the second half of 2023 was down 38% relative to the same period in 2022. U.S. M&A, specifically, was down 41% in terms of dollars and 5% in terms of deal numbers, according to Axios's report.
The deceleration in deal-making was evident in crypto firm Galaxy Digital's second-quarter earnings. The firm's investment banking business revenue came in at a mere $45,000, driven by a "deceleration in M&A and capital-raising activity."
As noted by advisory firm Architect Partners, the deal-making slump has continued into the summer, with August looking "as slow as expected with capital flows below average and smaller deal sizes" akin to July
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