Investment Bank Cowen（COWN）Launches A New Digital Asset Department

Cowen inc. is an American multinational investment bank.

Cowen was founded in 1918 and headquartered in New York.

Cowen is a financial service provider with two business segments; a broker-dealer and an investment management division.

As of 2022, Cowen has surpassed the $1 billion revenue target with total assets and equity of $8.7 billion and $1.0 billion, respectively.

The newly launched Digital Asset department is called Cowen Digital LLC.

The Cowen Digital LLC is a ledge digital asset division offering full-service trade execution and custody solutions for institutional clients.

Cowen will partner with PolySign’s Standard custody & Trust after investing $25 million in the past.

The digital asset division will comprise infrastructure and system that has been in their development stage for the past 15 years.

The Cowen Digital LLC will provide expertise in traditional finance and support and assist existing clients in planning and executing their decentralized finance strategies.

The newly launched Cowen Digital LLC’s use cases include giving investors access to the bank’s aggregated liquidity, utilization of Cowen’s proprietary algorithm, benefits of streamlined operational and capital efficiencies, etc.

Cowen Digital LLC was launched in March 2022.

Keywords: Cowen, investment bank, digital, token, cryptocurrency, division, asset.

The cryptocurrency ecosystem is expanding by the day. Over the years, it has witnessed a massive influx of big brands, corporate organizations, and traditional financial institutions.

Recently, another financial institution took a giant step to become one of the stakeholders in delving into the emerging cryptocurrency ecosystem. To the delight of its customers, Cowen inc, a US full-service investment bank, is launching its digital asset division.

Not to worry, this article will highlight how Cowen is breaking into the cryptocurrency ecosystem.

Let's dig in!

Cowen Investment Bank

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Image: LinkedIn

Cowen inc is an American multinational investment bank. This highly rated financial service provider operates a double business segment; a broker-dealer and an investment management division. Cowen was founded in 1918, with its headquarters in New York.

Cowen’s broker-dealer business segment offers investment banking services, prime global brokerage, sales and trading, equity and credit research, sales and trading, outsourced trading, global clearing, and commission management services. On the other hand, the investment management division offers actively managed alternative investment products.

As of 2021, Cowen inc has an estimated revenue of $1.9 billion, total assets of $8.7 billion, and total equity of $1.0 billion. There are about 1,534 employees in Cowen, and the investment bank also forays into research and market analysis.

Cowen Digital LLC; The Digital Asset Division

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Image: LinkedIn

On the 23rd of March, 2022, Cowen inc launched its dedicated asset division. The new digital asset division will offer full-service trade execution and custody solutions for institutional clients.

Drew Forman, the Managing Director of Cowen, and Dan Charney, the Cowen Co-President, said: “We (Cowen) will have a significant first mover advantage.”

The newly launched Cowen Digital LLC will be headed by Drew Forman, the Managing Director of Cowen and the former head of derivatives sales and trading at Cowen inc.

Being the head and the most active team member, he has much to say about the newly launched digital asset division. He said, “ The bank is already trading about 16 tokens that include Bitcoin (BTC), Ether (ETH), Solana (SOL), and USD Coin (USDC).”

In Cowen Digital LLC, custody solutions will be provided through Cowen’s strategic partnership with PolySign’s Standard Custody & Trust. The Standard Custody & Trust is a unit of PolySign, a digital asset infrastructure firm that Cowen invested about $25 million into in May.

Jeffrey M. Solomon, the Cowen Chair and Chief Executive Officer, said: “Through Cowen Digital, our clients now have access to the crypto and digital asset markets with our institutional quality and fully integrated end-to-end execution cum custody capabilities.” He added that “Cowen is committed to outperforming its clients by staying at the forefront of innovation.”

The Cowen digital asset infrastructure and the system have been in their development stage for the past 15 years. Being an investment bank, Cowen is launching this entirely new division to provide expertise in traditional finance and support and assist existing clients in planning and executing their digital asset investment strategies.

In an encompassing statement, Dan Charney, the Co-President of Cowen, emphatically said, “ We are very pleased to publicly announce Cowen Digital, which has been trading crypto on behalf of our clients for several months. In conjunction with our integrated partners, the Standard Custody and Prime brokerage solutions provider, Digital Prime Technologies.”

Dan Charney further added, "Cowen Digital provides our institutional client base with the same dedicated level of thought leadership, product capability, service, and professionalism they have come to expect from Cowen.”

Aside from the newly launched Digital Asset Division, Cowen revealed that it plans to offer crypto derivatives, futures trading, lending, and unfiltered access to decentralized finance (DeFi) protocols cum non-fungible tokens.

The newly launched Digital Asset Division currently has about 40 employees. It is expected that the staff will be expanded to about 100 when it introduces some other services.

Functions And Use Cases Of Cowen Digital LLC

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Cowen inc describes its Cowen Digital LLC as an integrated institutional-grade infrastructure that will enable institutional investors to do the following:

Cowen Digital LLC will enable investors and patrons to access the bank’s aggregated liquidity via a trusted counterparty.

Institutional investors can utilize Cowen’s proprietary algorithms through high-touch or low-touch trading.

Cowen Digital LLC users and investors will benefit from streamlined operational and capital efficiencies alongside post-trade reporting.

Access to direct trade from standard custody’s cold storage solution, the privilege to avoid pre-funding requirements, and receive flexible net settlement arrangements.

It is expected that Cowen will add derivatives, futures financing solutions, institutional DeFi, and NFT access as part of its future functionalities.

The Core Competitiveness of COWN

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Cowen inc has distinguished itself among other financial service providers. Some of the competencies and capabilities that have made Cowen distinguish itself from other financial service providers include;

Investment management

Cowen has proven domain expertise and differentiated strategies that have helped clients achieve their investment goals. Most times, investors are at a crossroad; they are confused about the choice of traditional or decentralized finance investment.

Cowen has various strategies and expertise to help clients in their investment choice and management.

Research

Cowen has displayed high level interest in research and this skill has distinguished them from other players in the marketplace.

Research works embarked on at Cowen have proffered sophisticated and industry-leading analysis. With these solutions, clients are well armed to stay ahead of emerging trends.

Impacts Of Cowen On The Crypto Market

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One thing that has made the investment bank stand out and be at the forefront of Wall Street's push into the crypto industry is that it started a digital asset unit offering.

Cowen now offers spot crypto trading. Through its COWN block chain, institutional clients now have access to spot crypto token trading and this innovation has continued to receive wide applause.

Similarly, Cowen Digital users will be able to trade about 16 digital digital assets including Ethereum, Bitcoin and Solana. Standard Custody & Trust co has partnered with Cowen and will provide custody for the assets.

Conclusion

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The launch of Cowen Digital LLC puts Cowen inc in the league of financial institutions such as JP Morgan, Goldman Sach, etc., that are now stakeholders in the cryptocurrency and Decentralized Finance (DeFi) ecosystem.

Since the launch of this wholly new digital division in March 2022, Cowen has continued to expand its customer base alongside its employees. While there are minimal functionalities in the newly launched digital asset division, the division is expected to grow and accommodate more decentralized financial services.

Author: Valentine. A, Gate.io Researcher

This article represents only the researcher's views and does not constitute any investment suggestions.

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