First Foundation Brings Bitcoin to Banking with NYDIG Investment

Smaller banks keen to stay ahead on the digital assets trend could follow First Foundation’s lead and seek more partnerships through strategic investments like this one.

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key takeaways

  • The investment will allow First Foundation to give NYDIG clients access to bitcoin-related financial products
  • NYDIG is the digital assets subsidiary of Stone Ridge Asset Management

First Foundation, a holding company whose subsidiaries include a wealth management firm and a bank, has made a strategic investment in bitcoin investment services firm NYDIG.

Terms of the deal were not disclosed. 

The partnership will allow First Foundation, which has bank branches and wealth management offices across California, Texas, Nevada and Hawaii, to give clients access to bitcoin-related financial products.

First Foundation is also working with payments processor Fiserv to allow customers to buy, sell and hold bitcoin through its own banking platform. It’s less common to see such partnerships from small regional and community banks, but First Foundation “hopes to establish itself as a key resource for clients wanting to access and use digital assets” through its NYDIG partnership, according to a press release.

Historically, developments in digital banking have threatened smaller banks, many of which have maintained and continued prioritizing a branch strategy and were latecomers in providing sophisticated digital experiences for customers. They’ve also long maintained that fintech startups should be regulated like traditional banks to even the playing field (although nearly all of them partner with regulated community banks).

Smaller banks keen to stay ahead on the digital assets trend could follow First Foundation’s lead and seek more partnerships through strategic investments like this one. Alternatively, Visa now provides an API for its bank customers, in partnership with Anchorage, to allow consumers to buy, sell and hold bitcoin through their banks’ existing platforms.

NYDIG is the digital assets subsidiary of Stone Ridge Asset Management. It provides bitcoin investment and technology solutions to insurers, banks, corporations, institutions and high net worth individuals. 

Earlier this year it acquired analytics company Digital Assets Data to provide crypto data, research and analytics capabilities to its customers. It plans to make more acquisitions this year as it builds out its prime brokerage offerings.

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