How custodians are adapting to digital-asset demand
The big custody banks are pursuing a variety of digital-asset custody strategies to encourage wider market participation from institutional clients.
As digital-asset adoption has surged, so has demand for institutional-grade digital-asset custody. Family offices, high net-worth individuals and external asset managers increasingly see that self-custodial solutions have limitations in supporting the ongoing trading and operational needs of their portfolios.
In response, custodians have expanded their role from the safekeeping of cryptocurrencies to helping clients navigate and participate in new business opportunities and asset classes.
One of the earliest movers in this field was BNY Mellon, whose digital-asset custody platform went live in the US in October 2022, enabling clients to hold and transfer Bitcoin and Ether.
According to a survey of institutional investors commissioned by the bank to coincide with the launch of the platform, more than 40% of respondents held cryptocurrency in their portfolio, while 70% said they would increase their digital-asset activity if services like custody were available from recognised and trusted institutions.
In May, Standard Chartered signed a memorandum of understanding with Dubai International Financial Centre to collaborate on digital assets, including digital-asset custody, with custody services provided by subsidiary Zodia Custody.