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Two cryptographic companies are merging in an attempt to simplify the management of cryptocurrencies for institutional actors.
CoinVantage, formerly a subsidiary of the MG Stover auditing company, joins Picks & Shovels, a supplier of tools for cryptor investors, to become a new entity known as Interchange. The new company, consisting of eight people, presents software products that will initially serve over 100 customers, including fund managers, hedge funds and digital exchanges.
Front and back-office systems for managing cryptographic resources are an unattractive but potentially lucrative corner of the blockchain industry as more and more financial institutions march into space. That's where Interchange says it will have a stronger software product than its competitors.
"We have worked very diligently, and now we have these partners who are going to catapult our knowledge and provide experience that is very rare," Co-founder and CEO of Picks & Shovels Matt Galligan told CoinDesk.
CoinVantage was a subsidiary of MG Stover until the announced merger on Friday. MG Stover is one of the first operators in the management of cryptocurrencies, being among the first companies to provide services to digital investment funds as early as 2014. CoinVantage was launched as a MG Stover branch in November 2017.
"The merger with Picks & Shovels will allow companies to combine systems to create a superior product," MG Stover founder and CEO Matt Stover told CoinDesk. "We are really excited about Interchange being one of the leaders in the technology space for digital resources".
Picks & Shovels was founded by Galligan, Dan Held and Clark Moody. While Galligan had already started technology startups in the media (Circa) and social (Socialthing) arenas, Held and Moody have long been cryptocurrency veterans. Held, who recently wrote a four-part series on the bitcoin story for CoinDesk, co-founded ZeroBlock (which was acquired by Blockchain in 2013). Moody was the founder of RTBTC, which in turn was acquired by ZeroBlock / Blockchain in 2014.
As for the momentum behind institutional cryptography, Galligan says that moves like Friday's merger could represent a trend towards 2019.
"I think there will be a general theme around making it easier to participate in this asset class for institutions," he said. "Accounting and portfolio accounting are a necessary function regardless of the state of the market."
Galligan refused to share the financial terms of the agreement. Stover will remain as CEO of MG Stover and will join the board of directors of the new company. The interchange will become the software platform of choice for MG Stover, according to a company statement.
Galligan says Interchange – which is completely distributed but with offices in San Francisco, New York and Denver – is actively hiring for engineers.
Interchange image via Shutterstock
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