Calgary-based FinTech startup Tetra Trust said it has received regulatory approval from the Government of Alberta to store cryptocurrency assets, which it claims makes the company “Canada’s first qualified custodian” of cryptocurrency.
Tetra said it received its certificate of registration from Alberta on July 5, following an 18-month process.
At the same time, the startup announced it has raised an undisclosed amount of strategic financing from Coinbase Ventures, Mogo, the Canadian Securities Exchange, Coinsquare, Urbana Corporation, and the Caldwell Growth Opportunities Fund. Tetra refused to disclose the total amount of funding it raised from investors.
“There is a pressing need for a regulated custody provider in Canada.”
-Eric Richmond, Tetra
Armed with regulatory approval and fresh capital from some notable FinTech and crypto companies, Tetra has set its sights on helping more institutional investors safely store their crypto assets. The startup told BetaKit it plans to use the new funding for working capital and regulatory capital purposes. When it comes to customers, Tetra is aiming to target institutional clients that wish to hold more than $1 million worth of crypto assets.
“We’re thrilled to launch Tetra Trust as Canada’s first qualified custodian for cryptocurrency assets and bring a Canadian-based solution to the market,” said Eric Richmond, CEO of Tetra Trust, and COO of Canadian crypto trading platform Coinsquare. “Canada has become a hot spot for cryptocurrency-related public companies, ETFs and trading platforms and there is a pressing need for a regulated custody provider in Canada.”
Founded in 2019, Tetra’s core business involves the custody and storage of crypto assets like Bitcoin and Ether. Tetra aims to help crypto service providers, investors, and fiduciaries mitigate the risk of theft and loss. Tetra charges an asset under custody fee as well as other transaction fees, while also providing escrow services for crypto transactions.
The startup said that, prior to its launch, “the Canadian market for cryptocurrency custody was limited to US providers and unregulated Canadian custodians.” The regulatory approval from Alberta would enable Tetra to provide crypto custody services to institutional investors.
RELATED: Coinbase to open Canadian office, launches hiring initiative
Tetra investor Coinbase Ventures is the venture capital arm of American crypto trading giant Coinbase, which announced plans to open a Canadian office in December. For Vancouver’s Mogo, Tetra is the second crypto company it has invested in during recent months, after the publicly-traded FinTech firm recently bolstered its stake in fellow Tetra investor Coinsquare.
“What’s so unique about Tetra is the idea of a consortium [of strategic investors] leading the way on this initiative and prioritizing a custody solution that’s made for the Canadian market,” said Jenna Kaye, CEO of Odyssey Trust and chair of Tetra Trust’s board of directors.
RELATED: Mogo increases Coinsquare stake for second time, gains ability to buy majority
According to Kaye, over the past six months, there has been “a monumental shift in the popularity of digital assets.” She claimed Tetra understands “the importance of regulation in increasing capital markets’ confidence in this space.”
Tetra estimates the current market for crypto custodial services is “in the tens of billions of dollars.” The startup aims to have more than a billion dollars’ worth of assets under management by the end of 2021.
UPDATE (07/12/21): This story has been updated to include responses from Tetra Trust.
Feature image by André François McKenzie via Unsplash