Hong Kong digital asset custodian Hex Trust raises $88m

Morgan Creek Capital, Primavera Venture Partners, LeadBlock Partners, Eterna Capital, and Sino Global Capital also invested. They were joined by Adrian Cheng, CEO of Hong Kong real estate giant New World Development, which has invested in virtual real estate provided by Animoca’s Sandbox platform.

Several blockchain industry players also participated, including Ripple Labs, Terraform Labs, Topaz, BlockFi, CoinList, Protocol Labs, Pulsar Trading, and Wintermute. Previous investors Kenetic Capital, QBN Capital, HashKey Capital, Fenbushi Capital, Radiant Ventures, and Cell Rising re-upped, according to a statement.

Kenetic, digital assets and blockchain specialist, made an investment of undisclosed size in 2020. This was followed by a USD 6m Series A in the first quarter of last year led by QBN. Animoca led a USD 10m round in October 2021.

The Series B includes USD 61m of primary capital and USD 27m from secondary investors. It will be used to scale the business across Europe and the Middle East, obtain additional licenses, continue development of the company’s proprietary platform, and enhance new business services such as financing and structured solutions.

Founded in 2018, Hex Trust provides fully licensed and insured bank-grade custody for digital assets. The company claims to deliver access to the latest developments in digital assets such as non-fungible tokens (NFTs), GameFi, and the metaverse. It currently has about 100 employees across Hong Kong, Singapore, and Vietnam.

Hex Trust has more than 200 institutional clients and USD 5bn in assets under custody. In the past year alone, it has attracted clients such as Algorand Foundation, Tezos Foundation, Celo Foundation, Flare Networks, Huobi Asset Management, UnionBank of the Philippines, DLA Piper, Sun Hung Kai & Co, Slow Ventures, HOF Capital, and Arrington Capital, as well as Animoca, Ripple, and Terraform.

In March 2021, the company became the first custodian to offer fully licensed support of NFTs. In November 2021, it announced a joint venture with Animoca to provide ultra-secure digital asset wallets and financial services for online gamers and to support the rapidly expanding GameFi ecosystem.

Last month, Hex Trust purchased a class of virtual real estate on Sandbox called LAND. Through this system, clients will be able to store their LAND assets with Hex Trust instead of online wallets. Hex Trust is also creating services to buy and sell LAND, as well as financing solutions including leasing LAND assets and “virtual mortgages.”

“As large institutions continue adopting digital assets at an increased pace, they need fully licensed custody services to meet compliance and regulatory standards. Our mission at Hex Trust remains the same: to stay ahead of the curve in terms of licensing and compliance, integrating the latest developments such as new protocols, DeFi, NFTs, GameFi, and the metaverse, and providing innovative services and financing solutions to enable our clients to monetise digital assets held in custody with us,” said Alessio Quaglini, CEO and co-founder of Hex Trust.

An industry report from Gartner shows that large organizations will accelerate their adoption of cryptocurrencies with companies such as Visa, Mastercard and Microsoft leading the way. Meanwhile, reports from Grayscale suggest the metaverse is expected to reach USD 1.5trn in value by 2030.

Imperii Partners served as the financial advisor for Hex Trust’s Series B.

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• Topics
• Greater China
• Financing
• China
• Hong Kong (China)
• blockchain
• Fintech
• Primavera