Independent US investment bank TD Cowen announced the closure of Cowen Digital just over a year after launching its crypto division, without providing a clear reason.
The multinational bank launched Cowen Digital in March 2022, offering institutional clients access to the crypto market through 16 crypto assets, including Bitcoin and ether.
At the time, the company also teased that it would launch additional services around futures, derivatives and decentralized finance. As recently as December, it hired executives for its European operations and has a team of about 10 employees.
However, Cowen Digital will close on June 1, according to a new email now circulating online seen by Bloomberg and others. "Today will be the last day for the Cowen Digital team," the email read.
In a deal that closed in March this year, Cowen Bank itself has undergone a restructuring after being acquired by TD Bank Group for $1.3 billion in August 2022. The closures come against the backdrop of the collapse of many cryptocurrency companies last year and US banking and regulatory woes in 2023. Notably, the email suggests that the Cowen Digital team is looking to continue its work under a different organization.
“Our entire team believes strongly in the need for a trusted counterparty who understands the needs of institutional investors – through white-glove high- and low-touch execution, deep knowledge-driven content, corporate visits and group education events. We will continue to work hard to make this happen, but Must be done in a different home," the email read. The closure of Cowen Digital marks the second institutional crypto client unit to close in a week.
Venture capital group Digital Currency Group (DCG) has opted to shut down its prime brokerage subsidiary TradeBlock, a process that began on May 31, Bloomberg reported on May 25. The company cited a "long crypto winter" and a tough regulatory environment in the United States. Cointelegraph also reported in February that DCG suffered $1 billion in losses in 2022 due to contagion sparked by the bankruptcy of crypto hedge fund Three Arrows Capital.
