Nasdaq to Launch Crypto Custody Service: BTC, ETH in 2023
Nasdaq to Launch Crypto Custody Service
- Nasdaq Stock Exchange is looking to launch a crypto custody service by the end of the second quarter of 2023.
- The service will initially offer custody services for Bitcoin and Ethereum.
- Nasdaq joins other traditional financial giants like Fidelity Investments, BNY Mellon and BlackRock in offering crypto services.
Nasdaq’s Digital Assets Division
Nasdaq first announced its plans to set up a digital asset business in September 2022 and has been steadily working on setting up the division over the months since. Ira Auerbach, senior vice president and head of Nasdaq Digital Assets, told Bloomberg that the exchange has been working on establishing solid infrastructure and securing the necessary regulatory approvals that will allow it to serve crypto customers. The exchange intends to kick off its digital assets business with custody services for the two largest cryptocurrencies by market cap — Bitcoin and Ethereum. Auerbach said that custody is just the first step in its plans to set up a broad range of services for digital assets. He added that Nasdaq’s division will eventually offer execution services for financial institutions as the business continues to expand.
Traditional Financial Giants Embrace Crypto
Nasdaq is not alone in jumping into cryptocurrency — joining a growing number of traditional companies offering crypto-related services. This includes other big names such as Fidelity Investments, BNY Mellon and BlackRock, which has over $10 trillion in assets under management. Asset management giant BlackRock quietly expanded into crypto this month, with CEO Larry Fink speaking highly of digital assets in his annual shareholder letter.
New York Department of Financial Services Approval Needed
To launch its digital asset division, Nasdaq needs approval from New York’s Department of Financial Services (DFS). The DFS requires Nasdaq apply for a limited-purpose trust company charter before it can begin operations serving customers in New York state or anywhere else in America. Once approved, Nasdaq could become one of only four major players providing institutional-grade custodial services alongside Coinbase Custody, Fidelity Digital Assets and Bakkt Trust Company.
As more traditional financial companies join forces with cryptocurrency projects, we are increasingly seeing an increase in adoption across different sectors and industries as well as increased confidence from major investors who have not yet joined the ranks of those investing directly into cryptocurrency markets but may now be more willing to do so thanks to increasing support from familiar names such as Nasdaq Stock Exchange.