- Wall Street firms and fintechs are embracing crypto and DeFi like never before.
- A consumer crypto craze is pushing finance firms to offer crypto-related products and services.
- These 14 fintechs are building the back-end tech to get Wall Street up to speed on crypto.
Wall Street firms are turning a corner when it comes to their acceptance of crypto and decentralized finance, but they could still use a little help getting there.
Consumer interest in crypto has driven financial stalwarts, once standoffish to digital assets, to open up to the tech. From JPMorgan enabling wealth clients access to crypto funds to Citigroup building out a crypto team to meet the rising demand for digital assets, the crypto craze has reached Wall Street.
But crypto requires a different kind of back-end tooling than traditional assets. Crypto and DeFi are enabled by blockchain technology, a digital and decentralized public ledger that sits across a network. It differs from the centralized ledger most banks use to keep track of money movement.
As firms look to offer more crypto-related services — like custody, trading, and wealth management — they’ll need to ensure the two infrastructures are compatible.
A new crop of fintechs has emerged targeting the back-end technology of crypto and DeFi. These behind-the-scenes fintechs, some of which have augmented their existing offerings to address the crypto demand, are becoming a critical layer of connective tissue for many Wall Street firms looking to bridge the gap in their tech stacks.
And just as crypto enjoyed a watershed year in 2021 among traditional finance firms, from Goldman Sachs to Bank of America, it also had a record year for private funding. In 2021, global venture funding into blockchain startups hit $25.2 billion, according to CB Insights. That’s a 713% increase over 2020 amounts.
Insider spoke to 10 investors to get the rundown on the top startups helping Wall Street get up to speed when it comes to crypto.