Crypto Custodian BitGo Acquires Tokenized Assets Company Brassica
BitGo CEO Mike Belshe explains his big bet on tokenized assets by acquiring Brassica
By: Zack Guzman
February 7, 2024
The excitement around tokenizing real world assets is heating up – and BitGo, one of crypto’s largest custodians – is attacking the opportunity by acquiring Brassica, a tokenized assets platform specializing in private securities.
BitGo CEO Mike Belshe joined Coinage to announce the acquisition, calling it “a very practical approach for how you would digitize [real world assets.]”
“We've got crypto and we've got traditional assets. And frankly, there's pretty much no overlap between these two,” Belshe explained to Coinage in a new interview. “With this acquisition, BitGo becomes the first major financial services firm to be able to provide comprehensive infrastructure support for both traditional private securities and blockchain-based assets, while significantly expanding our global presence.”
BitGo is one of the largest crypto custodians, having raised another $100 million last summer at a valuation of $1.75 billion. Recently, BitGo secured a strategic investment from the armored truck company Brinks and announced last week it would be stepping in to add custody services for Valkyrie's Bitcoin ETF, which had previously solely used Coinbase.
With the Brassica acquisition, Belshe explained that BitGo would have the tools necessary to customize whatever types of digital asset trading many of their existing and future clients might require as the number of tokenized assets increase. The company already helps manage custody for multiple Fortune-100 companies who have waded into Web3, including Nike. As legacy financial companies continue to be forced into playing catchup, just as they have with custodying Bitcoin in ETFs, they will likely have to continue to turn to trusted and regulated partners.
“What we're really talking about with real world assets is the ability to modernize these markets,” Belshe said. “Can we make them more transparent? Can we make them run 24/7? Can we have digital APIs that allow you to trade them?”
Brassica was founded in 2021 by CEO Youngro Lee and CTO Bob Dunton, co-founders of the investment crowdfunding platform NextSeed, which was later acquired by Republic. The company had raised $12 million as of last year and secured a Wyoming Trust Charter.
“Joining forces with BitGo is a significant step towards Brassica’s vision of building the financial infrastructure of the future,” Lee said in the announcement. “Our strength lies in our ‘one-stop-shop’ approach of providing API-enabled infrastructure for the alternative assets industry.”
Despite BitGo's growing size as a leading name in crypto custody, Belshe said the firm has no immediate plans to shift from being a private company.
"That might be the next step, but to be honest, I think right now the the public markets are still a little bit hostile for digital asset companies," he said on the prospects of an initial public offering. "We probably wouldn't go there yet."
Shares in Coinbase, the publicly-traded custodian that Bitcoin ETF issuers also turned to, have fallen more than 20% to start the year. Nonetheless, USDC issuer Circle announced plans to pursue an IPO last month.
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