Arca will use the funding to beef up its infrastructure and expand its crypto asset-class offerings.
Arca, an emerging digital-asset manager, has secured $10 million in Series A funding to bootstrap the next phase of its business strategy — one that could bridge the gap between traditional finance and cryptocurrencies.
In a Wednesday press release, Arca said the funding round was led by venture capital firm RRE Ventures, with key contributions from Alex Tisch, president of Loews Hotels & Co, and a “coalition of financiers led by Littlebanc Advisors.”
Arca sai it will use the funding to enhance its infrastructure and digital service offerings, as well as stay abreast of all the legal and regulatory requirements in the industry.
Rayne Steinberg, Arca’s CEO, told Cointelegraph that 2020 was a watershed year for cryptocurrency. Although that’s in large part due to Bitcoin (BTC), the firm has seen “this initial awareness translate into interest in the many other aspects of digital assets.”
When asked about the biggest roadblock to digital asset adoption, Steinberg identified the “confusing and fractured narrative” around cryptocurrency. He explaine:
“Sophisticated investors need to understand what they’re investing in before making investments. So, education standardization and consistency [in] message are things that are of equal importance to the actual products.”
Steinberg said the Series A investors have recognized that there is a large addressable market for crypto asset management — and have identified Arca’s potential in filling the void.
“Our investors recognized Arca’s plan to become the premier branded asset manager in digital assets as an idea with enormous potential,” he said.
Those views were echoed in the press release. James Robinson, founder and CEO of RRE Ventures, said his decision to back Arca stems from his long-standing experience with the firm’s management team:
“We have worked with members of the Arca senior team for the past two decades as they revolutionized asset management, giving us high confidence they can do it again with future evolutionary products.”
Founded in 2018, Arca provides a suite of investment products marketed to traditional investors who are looking for a way to tap into cryptocurrencies. The firm provides actively managed hedge funds and treasury management services dedicated to crypto.
Digital-asset management is a growing niche within the cryptocurrency industry, with firms like Bitwise and Grayscale seeing an influx of capital from new investors looking for direct exposure to the asset class.