CrossTower to Acquire Bequant: Launch “ESG Crypto” Fund

Crypto trading platform CrossTower says it has acquired digital asset prime broker and exchange Bequant, a move it says will add 600 “professional exchange clients” and generate over $400 billion of yearly turnover from exchanges connected to its platform. Terms of the deal were not disclosed – CrossTower was formed in 2020 with $6 million in seed funding.

“The market requires consolidation for the next stage of its maturity,” argues George Zarya, founder and CEO of Bequant. “Undoubtedly, the market will continue to grow and evolve with stronger regulation and with larger balance sheets, and it will earn back the trust of investors. We are uniquely positioned to bridge the gap with traditional finance and to modernise financial infrastructure. The combination of Bequant and CrossTower will allow us to have a truly global reach.”

CrossTower has also announced the launch of an ESG crypto fund, backed by Lydian Group “to invest in and rebuild companies that have promising futures”. Although the release announcing the fund does not specify the values required to attract investment – CrossTower is believed to be considering a second bid for Voyager Digital, which has few ESG credentials, after it lost out originally to FTX – it does states that the crypto industry “must become smarter and managing energy costs, given the reduced asset pricing and overall cost of energy”.

On social matters the release states, “The industry image has been tarnished by few players’ greed. We need to put the people and the democratisation of finance back into the centre of what makes crypto important.”

On governance, it says the biggest failure of the companies in trouble today has been human failure. “There needs to be proper governance – a proper board structure; related party checks and balances; and traditional business expertise. Crypto companies need to change to recreate value,” it states.

“We are stabilising an industry with incredible promise; regaining trust; and rebuilding the future of finance,” claims Kapil Rathi, CEO of CrossTower. “Rebuilding requires capital and a management team with regulatory and operational expertise. With the launch of our fund and the Bequant acquisition, we are positioning CrossTower to lead the growth of this industry, with proper regulatory oversight, integrity, and accountability.”

The acquisition of Bequant may actually be the first acquisition by the fund, for although CrossTower says it has acquired the firm, Greg Fishman – CIO of Lydian Group says in the release, “By uniting CrossTower and Bequant, we create an organisation that is built for safety, transparency, and trust.”