Cryptocurrencies seem to be the latest craze but not everyone understands Bitcoin and Ethereum, much less how to invest in them. Now, NYC-based investing startup Betterment is making it easier than ever to start buying cryptocurrencies. On Tuesday the company announced it acquired Seattle-based Makara and will now offer crypto investing on its platform.
Makara launched in 2021 and took a simplified approach to token investing. Instead of presenting investors with a slew of currencies and their associated prices, Makara lets people invest using robo-advisors. The digital assistant runs algorithms and invests your money in a strategic manner. This form of investing is often used by financial institutions and fintech startups primarily for stock trading.
When the startup emerged from stealth last year, the demand for bitcoin and other currencies was on the rise. In a month and a half span from early March to mid-April of 2021, the price of Bitcoin, the most abundant of the currencies, rose in price by nearly $20,000. Other coins such as Ethereum and Solana also saw significant gains around Makara’s launch. This led to increased demand for the startup’s platform and a $2 million seed round.
With the acquisition, Makara’s crypto and engineering teams will join Betterment and Betterment will introduce crypto investment options to its platform.
“Crypto is here to stay and Betterment wants to live our promise of long-term diversification and to provide our customers with the best variety of assets in the marketplace,” Betterment CEO Sarah Levy said in a prepared statement. “Makara is unique in offering consumers managed crypto portfolios combined with the guidance and ease-of-use that have defined Betterment. Makara is to crypto today what we are to traditional investing since pioneering robo-investing a decade ago.”
Betterment also operates on a risk reduction philosophy, but it takes a different approach than Makara. The NYC fintech company uses robo-advisors to create equity portfolios rather than using the advisors to directly invest money like Makara.
Betterment was founded in 2010 and has raised $435 million in funding since its launch, according to Crunchbase.
The financial terms of the acquisition, which is expected to close in Q1, were not disclosed.
