Goldman leads round in Alan Howard's crypto company, Elwood

Elwood Technologies, a crypto software maker founded by British billionaire Alan Howard, raised $70 million in its first outside round of funding, with Goldman Sachs and Dawn Capital leading.

Why it matters: It's rare to see a bank leading a round in a crypto company. Goldman Sachs' co-lead position underlines how it's become one of the most active bulge bracket banks in the digital asset space.

Background: Earlier this year, Goldman revealed its first ever bitcoin-backed loan. It also made its first over-the-counter crypto trade in March. Last year, it began offering bitcoin derivatives to investors and led a round in Coin Metric, a crypto analytics business.

Details: Crypto proponents have long hoped for wider institutional adoption, believing the sector will surge once the giants enter. But institutions have been slow to jump in.

• "There's still a big retail mindset when it comes to digital assets and crypto," Elwood CEO James Stickland tells Lucinda. "Having algorithms, for example, are not standard ... we've taken it upon ourselves to fill some of that hole."
• While traditional asset classes have Bloomberg or BlackRock Aladdin, crypto still lacks that kind of complex software, Stickland says.
• Elwood allows traders to access multiple crypto exchanges through one platform and also offers order management and portfolio management capabilities.

Notably, the funding is not coming from Goldman Sachs' growth equity arm but directly from its digital assets team.

• The bank will also be taking a board observer seat in the business.
• Other investors in the round included Barclays, BlockFi Ventures, Chimera Ventures, CommerzVentures, Digital Currency Group, Flow Traders and Galaxy Digital Ventures.

By the numbers: The deal values the company north of $500 million, a source with knowledge of the matters confirmed to Axios.

• Though Stickland declined to reveal revenue figures, he says the company is handling billions of dollars in flow and has over 30 customers.

Yes, but: The funding announcement comes amid a crypto selloff, with bitcoin having shed its gains for the year. Which inevitably raises questions about whether banks are here to stay this time around.