A New $400 Million Investment From Citadel Securities Values Crypto.com at $20 Billion. Here's What That Means For Crypto.
Key Points
Citadel Securities just invested in one of the world’s largest crypto exchanges.
It’s more of an investment in infrastructure than in revenue growth.
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Crypto.com, one of the world's largest cryptocurrency trading platforms, was recently valued at $20 billion after a $400 million investment from Citadel Securities. That marked the company's first-ever investment from an institutional investor since its founding ten years ago.
Citadel's investment in Crypto.com is interesting, since it comes at a time when fears of interest rate hikes are chilling the cryptocurrency market. That's why Coinbase's (NASDAQ: COIN) stock has declined nearly 60% over the past 12 months. Let's see what Citadel's big investment in Crypto.com tells us about the broader crypto market.
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What sets Crypto.com apart from other crypto exchanges?
Crypto.com is based in Singapore, but it has secured licenses and regulatory approvals worldwide. That makes it more comparable to Binance, the world's largest crypto exchange, than Coinbase, which is based in the U.S. and heavily dependent on U.S. investors.
Crypto.com serves more than 150 million users worldwide. It offers separate crypto trading platforms for novice and experienced investors, a prepaid crypto-linked Visa (NYSE: V) card, a non-custodial wallet for decentralized finance (DeFi) transactions, and other trading tools for stocks, exchange-traded funds (ETFs), retirement accounts, and prediction markets. Coinbase also launched stock and ETF trading tools on its platform earlier this year.
Crypto.com also mints its own native token, Cronos (CRYPTO: CRO), which can be staked (locked up) on its platform to unlock lower trading fees, higher reward tiers on its Visa card, and participation in its platform events (including token distributions and yield boosters). It plans to expand its addressable market through its Visa card and boost its visibility through high-profile sporting events and celebrity sponsorships.
Why is Citadel Securities investing in Crypto.com?
Citadel is investing in Crypto.com to accelerate its expansion beyond cryptocurrency trading. It wants the platform to grow its futures and options trading infrastructure and to tokenize more traditional financial assets (such as stocks and bonds) on its blockchain. Citadel can then use Crypto.com's infrastructure as a foundation for its round-the-clock, cross-asset trading.
Citadel is also expanding its reach beyond institutional-only platforms (such as EDX Markets, which it co-founded) by taking stakes in retail platforms, including Kraken. It has also partnered with Robinhood (NASDAQ: HOOD) to bundle its orders into its high-frequency trades. Citadel's investment in Crypto.com complements that strategy.
Crypto.com reportedly generated $1.5 billion in revenue in 2024. If it had grown at a rate similar to Coinbase's in 2025 (9%), it might have generated $1.64 billion in revenue last year. At $20 billion, it would be valued at about 12 times its trailing sales, compared to Coinbase's price-to-sales ratio of 8.5.
That valuation might seem rich, but it closely mirrors Citadel's investment in Kraken last year, which also valued the crypto exchange at $20 billion. Therefore, Citadel is likely more interested in Crypto.com's infrastructure instead of its near-term revenue growth.
What does this investment tell us about the crypto market?
Citadel's investment in Crypto.com isn't necessarily a green flag for leading cryptocurrencies like Bitcoin or Ether. Instead, it's a vote of confidence in the eventual convergence of the crypto, options, and equities markets -- as well as the tokenization of more traditional assets on the blockchain to accelerate financial transactions. It's also making its move as macro headwinds curb the market's enthusiasm for crypto companies.
However, it also indicates the crypto market will eventually recover as the macro environment improves. When that happens, Citadel's investment in Crypto.com will bear fruit as it gains even more access to the platform's infrastructure and trading capabilities. Citadel could also reap massive profits if Crypto.com decides to go public at an even higher valuation.
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Leo Sun has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin, Ethereum, and Visa. The Motley Fool recommends Coinbase Global. The Motley Fool has a disclosure policy.
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