Nasdaq To Start Crypto Custody Service for Institutional Clients
According to a press statement released on Tuesday, Nasdaq (NDAQ), which is the second-largest U.S. stock exchange operator, is launching a cryptocurrency custody service in an effort to capitalize on the demand from institutional crypto investors. In a press statement, it was informed that Ira Auerbach, has been hired by the company to lead the division of its digital assets. Ira Auerbach formerly oversaw prime brokerage services at Gemini as well. Despite not having any immediate intentions for acquisitions, Auerbach stated that Nasdaq is open to collaborating with crypto-native companies. According to Tal Cohen, head of North American markets at Nasdaq, "Demand among institutional investors for engaging in digital assets has surged in recent years, and Nasdaq is well-positioned to promote broader adoption and achieve sustainable development." In collaboration with asset management Hashdex, the exchange introduced a digital assets curriculum for financial advisors in 2021. According to its release, the course aimed to "offer financial advisors with instructional and instructive information on the expansion of the digital asset ecosystem, investing concerns, legislation, taxation, and more." More recently, the Nasdaq joined forces with XP, the biggest trading company in Brazil, to develop a bitcoin and cryptocurrency exchange in that nation. The new institutional custody product from Nasdaq is still awaiting regulatory approval. In the cryptocurrency industry, custody is a lucrative but crowded business, with institutional custody providers fetching multi-billion dollar valuations. Ledger, a provider of cryptocurrency wallets and custody services, achieved a valuation of $1.5 billion in June 2021, and Anchorage finished a $350 million fundraising round with a valuation of $3 billion in December 2021. The launch of the unit, according to a statement made after the article was published by the company, "underpins Nasdaq's ambition to advance and help facilitate broader institutional participation in digital assets by providing trusted and institutional-grade solutions focused on enhanced custody, liquidity, and integrity." The entry into cryptocurrency by the company is a part of a larger trend on Wall Street. Last month, Depository Trust & Clearing Corp., which handles almost all trades on the U.S. stock market, released its own blockchain in an effort to speed up trade settlement, and BlackRock, the largest asset manager in the world, announced that it will offer cryptocurrencies to its institutional clients.