Tue. Jan 18th, 2022

Hedge fund billionaire Ken Griffin has sold a $ 1.15 billion stake in his trading firm Citadel Securities to prominent venture capitalists Sequoia and Fred Ehrsam’s digital asset group Paradigm and plans to spend the money on more aggressive international expansion.

The deal values ​​Citadel Securities at $ 22 billion, and is the first time it has taken any external investors. The news of the outside investment was first reported by the Wall Street Journal.

Citadel Securities was established in 2001 as a separate entity from Griffin’s $ 43 billion hedge fund Citadel, and has emerged as a significant player in world markets in its own right over the past decade.

The market making business has been one of the biggest beneficiaries of the move to high speed trading over the past decade. It acts as an intermediary between sellers and buyers in stocks, bonds and derivatives and, according to its website, handles about 27 percent of all U.S. stock trading.

His ability has attracted envy from other parts of Wall Street, increasing attention from regulators and politicians, and resentment among many of the retail traders for whom Citadel Securities acts as a market maker.

Sequoia, one of Silicon Valley’s oldest and largest venture capital groups, is known for its early bets on Apple, Google and WhatsApp. His partner Alfred Lin will join Citadel Securities’ board of directors. Paradigm is a newer VC firm, founded in 2018 by Coinbase co-founder Ehrsam and Matt Huang, former Sequoia Capital partner.

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