For some time “The Institutions are Coming” has been a bit of a mantra in the crypto asset space. But to date, adoption by traditional financial institutions has lagged industry expectations. Every day, there are more signals that belief in the importance of this asset class is pervading these institutions but there remains another major hurdle to adoption — institutional investor-friendly trading platforms.
To get comfortable, financial institutions need familiar trading technology, liquidity pools large enough to support their volume, and a brand they can trust. This is precisely why Initialized funded Talos and why we’re extremely proud to announce we were the lead investor of their most recent capital raise with participation from Autonomous Partners, Castle Island Ventures, Coinbase Ventures, Notation Capital, Founder Collective, and V1.VC.
Digital asset exchanges have had a wild and at times sordid history. This evolution is understandable given that the invention of Bitcoin created a new class of digital assets, which could be instantly and irrevocably transferred over the Internet — a novel threat model in the world of financial services. Out of necessity, early trading technology platforms were the domain of technologists deep in the ecosystem, who built everything from custody to order books in house. In hindsight, it was then no surprise that these conditions gave rise to massive losses via exchange hacks and scams.
Fast forward to today, exchanges and other trading venues are catching up in quality to their equivalents for more traditional asset classes. But these solutions have remained relatively siloed, which has made price discovery, liquidity sourcing, and asset allocation challenging. What has been missing to date is a platform sitting between them all, giving access to liquidity across all these venues and providing services like best execution and facilitation of settlement and this is exactly what Talos has created.
When we met Anton and Ethan, the Talos founders, we immediately knew they were the team to fill this gap in market. It was clear they had the technical credentials to deliver on the extreme security and performance requirements of the use case. Even more, they had many years of experience building parallel technology in traditional markets at AQR Capital Management and Broadway Technology. This meant both that they knew exactly the kind of experience users of these platforms were looking for, but also that mainstream financial institutions would be quick to trust their work.
So if you are at a large financial institution and feel it is time to get into digital asset trading, do get in touch with Talos. The pace of new features since I’ve been working with them has already been impressive, so I expect their platform to improve by the day and can’t wait to see what they release next.