Citi-backed crypto unicorn Talos acquires DeFi platform Skolem

Talos, a crypto trading software provider and unicorn backed by heavyweights including Citibank and Andreessen Horowitz (a16z), has acquired Skolem, which offers a DeFi-access platform.

The size of the deal and other terms weren't disclosed, but Talos said Skolem would help expand its on-chain capabilities and connect its institutional clients to additional decentralized finance or DeFi services.

"This acquisition helps Talos expand our on-chain capabilities and provide clients with access to additional DeFi liquidity pools as well as expand our PMS [portfolio management service] offering to include DeFi services," Talos co-founder and CEO Anton Katz told The Block.

"As the digital assets market evolves, a number of our clients are interested in accessing such capabilities to diversify their investment strategies or, in turn, provide such capabilities to their customers via our white-label offering," Katz added.

Founded in 2020, Skolem provides a platform for institutional investors to access DeFi markets, including trading, staking, lending and liquidity provisioning on DeFi protocols. Katz said the Skolem platform will be "fully integrated" into Talos as part of the acquisition.

The Talos-Skolem deal

Talos and Skolem first met in 2022 and started working together shortly after, Katz said. The acquisition talks began almost a year ago, and the deal was finalized "a few weeks back," he added — noting that the deal is complete and there are no pending approvals.

While the deal size hasn't been disclosed, it appears to be a significant transaction. Skolem raised $20 million in Series A funding in 2022 from high-profile investors, including Galaxy Digital, Steve Cohen's Point72 Ventures, Jump Crypto and Dragonfly Capital.

Based in New York, Skolem appears to have a headcount of up to 50 people, according to its LinkedIn page. Katz declined to comment on Skolem's specific headcount or whether its staff will join Talos as part of the deal.

Skolem is Talos' third acquisition

Talos' acquisition of Skolem is its third and comes just a month after it acquired Cloudwall , a crypto risk management platform. Last year, Talos also acquired D3X Systems to expand its pre-trade capabilities.

Talos is open to more deals. "There are phenomenal teams out there building great products, and we have a number of exploratory conversations going on around how we can provide their services to the global community of Talos' clients," Katz said.

Talos was valued at $1.25 billion in 2022 when it raised $105 million in a Series B funding round. Katz declined to provide Talos' latest valuation. Besides Citibank and a16z, its investors include Wells Fargo Strategic Capital, BNY Mellon, PayPal Ventures, Castle Island Ventures and Fidelity Investments.