London-based investment trust RIT Capital Partners has recently acquired a stake in crypto exchange Kraken. The trust with $5.3 billion in its portfolio holds ties to the Rothschild banking family through Chairman Jacob Rothschild

It seems that the London firm is convinced in Kraken’s potential amid the success of Coinbase, citing its “quarterly revenue of $1.8bn in the Q1 2021” and its recent direct listing on April 14.

While the amount of RIT Capital’s investment was not disclosed, it certainly has its eyes on taking the front seat in anticipation of Kraken’s 2022 direct listing.

RIT Capital’s investment was made public during a webinar with Numis Securities. The Webinar referred to a note from James Glass, Head of Investment Companies Equities with Numis. In his April 12 note to investors, Glass highlighted Kraken’s potential and described the exchange as “one the world’s biggest crypto exchanges having been founded in 2011. It has more than 6M clients and is the 4th largest exchange by trading volumes.”

“According to media reports, Kraken is considering going public through a direct listing in 2022, after seeing record trading volumes and new clients amid a surge in the price of Bitcoin,” Glass noted.

The trust notes the potential of the acquisition. In the light of talks over a new fundraising round, it is considering Kraken’s valuation to grow to a possible price range between $10 to $20 billion.

The Big Three competing

It seems competition is heating up among larger exchanges and Kraken is joining Binance in taking on the first Nasdaq listed crypto exchange Coinbase. According to CoinMarketcap, Kraken processed more than $2 billion in volume over the past 24-hours to Coinbase’s $3.9 billion in volume.

It is not the first time that RIT Capitals ventures into crypto. The firm that was founded in the 1960s and is currently listed on the London Stock Exchange, backed a $142 investment round for Paypal’s crypto partner and stable coin issuer Paxos in December 2020.

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