RIT Capital Partners Invests in Crypto Exchange Kraken, Signals Bullish Stance on Industry

London-based investment trust RIT Capital Partners has revealed a strategic stake in Kraken, one of the world’s largest and most recognized cryptocurrency exchanges. In an official announcement, RIT Capital—originally known as Rothschild Investment Trust—highlighted its belief in Kraken’s prospects, praising the platform’s nearly six million clients and ongoing discussions that could set its valuation between $10 and $20 billion.

With a market capitalization of around $5 billion, RIT Capital Partners is no stranger to the burgeoning crypto space. The trust has previously funded other significant ventures, including a $142 million investment round for stablecoin issuer Paxos. By aligning with Kraken, RIT Capital signals fresh confidence in the crypto exchange sector—especially on the heels of Coinbase’s high-profile public listing in April 2021.

This article provides an overview of RIT Capital Partners, its history with crypto investments, Kraken’s public-listing ambitions, and the broader context of digital-asset exchanges vying to go public.

1. RIT Capital Partners at a Glance

1.1 Background & Legacy

• Founded: 1961 (originally Rothschild Investment Trust)
• IPO: 1988 on the London Stock Exchange
• Market Capitalization: Approximately $5 billion
• Chairman: Jacob Rothschild, linking the firm to the Rothschild banking family

RIT Capital stands out in the investment trust arena for its diverse, global approach. Over the years, the firm has placed strategic bets in both traditional finance and emerging technology. Its foray into cryptocurrencies underscores a forward-looking perspective on digital assets.

1.2 Previous Crypto Ventures

RIT Capital Partners has delved into crypto before. In December 2020, the firm contributed to a $142 million investment round for Paxos, a stablecoin issuer and PayPal partner. That partnership paved the way for PayPal’s crypto services, evidencing RIT’s willingness to back projects shaping digital finance infrastructure.

2. Why RIT Capital Partners Invested in Kraken

2.1 Kraken’s Global Standing

Kraken is one of the largest and oldest U.S.-based crypto exchanges, boasting over 6 million clients worldwide. Renowned for:

1. Strong Security Track Record
2. Wide Array of Supported Assets
3. Advanced Trading Features

Kraken has long attracted institutional traders, retail investors, and a rapidly expanding user base. Its global brand presence resonates particularly well with an investment trust like RIT Capital that targets global growth opportunities.

2.2 Valuation & Growth Prospects

RIT’s public statement noted Kraken’s rumored new fundraising round aiming for a valuation ranging from $10 billion to $20 billion. As crypto adoption soars:

• Coinbase: Demonstrated success by going public at a reference price of $250, seeing share price swings up to $420.
• Kraken: Plans to potentially match or surpass Coinbase’s trajectory, expecting to go public through a direct listing in 2022.

For RIT Capital, acquiring a stake early may position the trust for significant upside once Kraken finalizes its next funding round or eventually lists publicly.

3. The Kraken Opportunity

3.1 Public Listing in 2022

Kraken initially considered a SPAC (Special Purpose Acquisition Company) merger at a $10 billion valuation but has since delayed that approach, seeking fresh capital that could double the valuation figure. Now, the exchange is eyeing a direct listing—like Coinbase—sometime in 2022.

3.2 Crypto Exchange Expansion

Beyond Kraken, multiple exchanges worldwide, such as Binance, Gemini, and others, are mulling expansions or potential listings. As more operators enter global capital markets, institutional acceptance of digital assets is expected to increase—potentially boosting the entire industry’s credibility and capital inflows.

4. Ripple Effect of Coinbase’s IPO

Coinbase’s April 2021 public listing was a watershed moment, providing:

1. Investor Benchmark: A direct reference point for evaluating private crypto exchanges.
2. Proof of Concept: Showcasing the capacity to mainstream crypto trading.
3. Tech Investor Confidence: Encouraging VCs and public market players to further support exchange platforms like Kraken.

RIT Capital’s reference to Coinbase’s $1.8 billion Q1 2021 revenue underscores the tantalizing market potential that could soon translate to Kraken’s business.

5. RIT Capital’s Broader Crypto Vision

5.1 Linking Traditional Finance with Digital Assets

Once known primarily for typical banking and investment services, the Rothschild-linked RIT now regularly eyes deals that bridge conventional finance and fintech frontiers. By embedding itself into the crypto exchange domain:

• Competitive Edge: Gains direct exposure to growth in trading volumes, user adoption, and DeFi expansions.
• Portfolio Diversification: Bolsters the trust’s holdings with a non-traditional asset class that is rapidly scaling.

5.2 Ongoing Partnerships

Aside from Paxos and Kraken, it wouldn’t be surprising if RIT invests in other segments of the crypto ecosystem—ranging from institutional custody, decentralized finance solutions, or infrastructure projects.

6. What This Means for the Crypto Market

6.1 Institutional Endorsement

When established entities like RIT Capital Partners back prominent exchanges, they provide broader market legitimacy. Investors often follow cues from known institutional names, further accelerating mainstream acceptance of digital assets.

6.2 Strengthened Exchange Competition

Kraken’s inflow of investor capital could fuel service enhancements, global outreach, and marketing. Competing exchanges might respond with expansions, greater asset listings, and deeper liquidity—benefiting end-users through improved services and more competitive trading fees.

6.3 Confidence in the Future of Crypto

Amid debates on regulation or short-term market corrections, major institutional bets signal confidence in crypto’s staying power. Such endorsements suggest that crypto isn’t a speculative side note but an evolving financial pillar, with tangible user growth and use cases.

Conclusion

By taking a stake in Kraken, RIT Capital Partners reaffirms its bullish view on cryptocurrency exchanges and the digital asset economy at large. This move aligns with a broader pattern: established investment houses are increasingly unifying with major crypto players. With Kraken aiming for a public listing in 2022—and seeking valuations that could rival or exceed peers like Coinbase—RIT’s early support may yield significant strategic returns.

Simultaneously, the announcement cements Kraken’s reputation as a prime contender in global crypto markets, benefiting from the capital and credibility associated with high-profile backers. As more institutional money flows into the space, both crypto exchanges and the wider ecosystem stand to gain from expanded user adoption, improved infrastructure, and potentially lighter skepticism from mainstream finance.

To learn more about the innovative startups shaping the future of the crypto industry, explore our article on latest news, where we delve into the most promising ventures and their potential to disrupt traditional industries.