๐ Kraken Launches Crypto Custody Service for US Institutional Clients
Kraken, the popular crypto exchange, has recently introduced a new crypto custody service in the United States. This service is specifically targeted at institutional clients and is provided by Kraken Financial, a state-chartered bank based in Wyoming. The offering includes digital asset custody and institutional deposit accounts. The launch of this service comes at a time when the crypto market is experiencing renewed excitement, driven by the approval of Spot Bitcoin ETFs and increasing interest from institutional investors.
๐ฆ Kraken Financial: An Independent Operation
Itโs important to note that Kraken Financial operates independently from the main Kraken exchange. The funds and assets of Kraken Financial are kept separate, ensuring enhanced security for its clients. Wyoming, where Kraken Financial is based, has been at the forefront of crypto regulation. The state has taken proactive steps to create a clear regulatory structure for the industry, including the establishment of a fintech sandbox in 2020 to encourage experimentation with new financial products and services.
๐ผ Major Banks Entering the Crypto Custody Market
The market for crypto custody services is becoming increasingly competitive, with major financial institutions entering the space:
- HSBC launched its own custody service for digital assets last year, targeting institutional clients interested in tokenized securities.
- Custodia Bank introduced its Bitcoin custody platform in certain states within the US.
- Taurus, a Swiss crypto firm, partnered with Deutsche Bank to combine crypto custody with tokenized services.
- Zodia Custody, backed by Standard Chartered, began offering digital asset custody services in Singapore.
โญ๏ธ The Importance of Qualified Custodians
Tim Ogilvie, Head of Kraken Institutional, emphasized the significance of qualified custodians in the institutional crypto space. The success of Bitcoin ETFs has further highlighted the need for a broader range of custodial services. With the launch of Kraken Custody, institutional clients now have another option to consider. The state-chartered status of Kraken Financial enables it to offer custody solutions that meet the requirements of institutions.
๐ก Hot Take: Institutional Crypto Custody Gains Momentum
The introduction of Krakenโs crypto custody service for US institutional clients reflects the growing demand for secure and reliable storage solutions in the crypto market. As more institutional investors enter the space, there is an increasing need for qualified custodians who can safeguard digital assets. The competition among major banks and financial institutions to provide these services demonstrates the industryโs potential and paves the way for further adoption and integration of cryptocurrencies into traditional financial systems.
Sources:
- Kraken Unveils Qualified Custody Solution for Crypto in the US
- Wyoming Banking Division โ Fintech Sandbox
- HSBC Announces Plans to Launch Digital Asset Custody Service in Partnership with METACO
- Custodia Bank Launches Bitcoin Custody Service for Businesses
- Deutsche Bank Partners Taurus to Offer Crypto Custody Services
- Standard Charteredโs Crypto Subsidiary Zodia Custody Launches in Singapore
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