This Peter Thiel-Backed Venture Makes Executing Large Crypto Orders Simple

Siamak Masnavi
  • 18 Dec 2018

On Monday (17 December 2018), Tagomi Holdings, a FinTech startup backed by top-tier investors such as billionaire Peter Thiel's Founder Fund, announced that Tagomi, which is "an institutional-grade aggregation platform for trading crypto assets at scale," had gone live.

Back in May, The Wall Street Journal reported that Thiel's Founders Fund was "backing a startup that aims to bring Wall Street electronic-trading expertise to the bitcoin market—a bet that cryptocurrencies will continue to gain mainstream popularity." So far, Tagomi has raised $16 million; a few examples of its other major investors are Collaborative Fund, SV Angel, Brainchild & Co, and Digital Currency Group.

Tagomi "execute trades across multiple liquidity venues, including exchanges and OTC desks, in order to achieve better price execution for clients." There are two types of clients that Tagomi believes its electronic brokerage platform is most effective for: 

  • Sophisticated investors "looking for better priced executions in cryptocurrency"
  • Institutions that demand "a high level of regulatory compliance"

According to Tagomi's press release, Tagomi has several other interesting features besides providing access to cash spot markets for crypto, and that it is this combination of features that makes Tagomi unique. These features include

  • End-to-End Solution: "More than just software, Tagomi provides a complete brokerage service including execution, capital management, and custody."
  • Robust Trading Infrastructure: "an order routing infrastructure built by a team with years of experience in electronic trading" (with support for both exchanges and OTC desks)
  • Advanced Execution Algorithms: "Tagomi bundles order routing with settlement and cash management capabilities so that clients do not have to interact with multiple systems and exchanges."
  • Custody: "Tagomi works with banks and custody providers to enable secure transfers and custody on behalf of clients."
  • Post-Trade Reporting: "Tagomi provides clients with post-trade reporting, which ensures clients see exactly how and where their trades were executed."
  • Execution Consulting and Advice: "Tagomi brings years of experience trading in other markets to bear in helping tailor an execution strategy for clients"

Here is a quick look at some members of Tagomi's leadership team:

  • Jennifer Campbell (Co-Founder and CEO): Prior to Tagomi, Campbell worked with "many early investors and founders in the digital asset space while at Union Square Ventures" 
  • Greg Tusar (Co-Founder & CTO): Former Global Head of Electronic Trading at Goldman Sachs (where he worked for 13 years)
  • Marc Bhargava (Co-Founder & Head of Business Development): While working as part of the investment team at Brainchild & Co, Bhargava came into contact with several blockchain startups (e.g. Filecoin).

Joe Lonsdale, the founder of Palantir Technologies and a General Partner at VC firm 8VC, who is one of Tagomi's backers, had this to say:

"Cryptocurrency trading lacks the transparency and sophisticated execution that top family offices and wealth management firms have come to expect. I’m excited to see an ambitious team with the right experience in finance and technology fix this, creating a solution we trust."

And Tagomi Co-Founder and CEO Campbell said

Tagomi has two initial products:

  • A Streamlined Execution Product: "A tool tailored to the High Net Worth individual, Family Office or Fund investor looking to gain access to cryptocurrency markets. These sophisticated investors can use advanced underlying tools along with a simple, streamlined interface to monitor the value of their portfolio holdings."
  • An Advanced Trading Product: "A tool designed for the active trader looking for aggregated access to markets and advanced execution strategies, with a user interface designed for easy, fast order entry, and advanced charting capabilities."

Tagomi CTO Tusar told Bloomberg:

“We began building in March and began testing our platform a number of months ago. We’re launching now because we finished building the platform and want to go out and engage clients. The people we’re engaging so far are still interested and engaged because they see what this technology can do over the long-term... In taking the long view, I really believe that this is a transformative technology, that we’re still in the early stages."

 

Featured Image Courtesy of Tagomi Holdings, Inc.