Swan Bitcoin’s chief executive sits opposite most in the cryptocurrency world. For starters, Cory Klippsten says he is not in crypto.
“I’m not in crypto, I’m in financial services focused on Bitcoin,” Klippsten said.
His company’s Bicoin exclusivity has proven to be a key differentiator in the decentralized finance world. While some of the largest trading platforms tumbled this year following the collapse of FTX and Binance, Swan reports it raised and deployed $205 million across its equity and credit lines of business.
Founded in 2019, Swan Bitcoin began as a financial services firm that sets up investment plans for wealthy families and investors. Last month, Swan launched Swan Institutional, a unit broadening its reach into private equity, Bitcoin-backed lending, financial advisor services, asset management and a Bitcoin-centric trust company. Through these different business lines, Swan Bitcoin falls more within the definition of a Bitcoin holding company. The company currently generates $125 million in revenue per year, and its first asset management fund, called Timechain Alpha, was fully subscribed with $50 million now under management.
To manage this expansion, Swan raised $40 million last year and is gearing up to raise $150 million in this year’s first quarter.
Investors may be following the footsteps of private equity firm Blackrock, which met with the SEC about its Bitcoin Exchange Traded Fund application last year.
“It’s all changing now because you have the largest, most credible, trusted financial firms in the world and they’re going to be marketing their Bitcoin ETFs,” Klippsten said. “If we want a piece of that, there’s a bunch of product we have that they don’t.”
Bitcoin democratization
Bitcoin has regained a strong market foothold, trading at more than $43,000 this month, marking a strong rebound from its lows in 2022.
Despite the recent highs, newcomers to the space could still be thrown by Bitcoin’s volatility, which is why Swan is building a financial advisor consulting arm acting as a go-to source for those unable to field specific questions on Bitcoin’s infrastructure and technological operations. Swan Advisor Services works with over 30 registered investment advisory firms in the U.S. as consultants.
“The consensus is developing that ignoring Bitcoin is irresponsible, and potentially a breach of financial advisor’s fiduciary duties,” said Ryan Flynn, a managing director of Swan Advisor.
When partnering with Swan, advisors can buy, hold and manage “real” bitcoin for clients. The real designation means the Bitcoin transacting avoids rehypothecation, a policy Swan holds across all its products that promises clients hold real bitcoin, not proxies or currency equivalents.
Swan believes Bitcoin is a “pristine” asset to leverage in the capital markets due to its reliability. However, the currency can be volatile when crypto markets come under pressure, as seen in its 80%-plus dip last year.
