Nasdaq digital assets group to launch cryptocurrency custody service

Nasdaq digital assets group to launch cryptocurrency custody service

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Nasdaq Inc. is expanding its interest in cryptocurrency with a new group dedicated to digital assets that will initially launch a cryptocurrency custody service.

Despite some reports referencing sources only, Tal Cohen, Nasdaq’s executive vice president and head of Northern American markets, has confirmed the exchange’s plans.

The new digital assets group is headed by Ira Auerbach, who previously ran prime broker services at crypto exchange Gemini Trust Company LLC. “We believe this next wave of the revolution is going to be driven by mass institutional adoption,” Auerbach told Bloomberg. “I can think of no better place to bring that trust and brand to the market than Nasdaq.”

The move by Nasdaq to offer crypto custody services is a likely first step by Nasdaq into offering additional cryptocurrency-related services. A custody service would see Nasdaq securely storing digital assets for clients to protect them from loss and theft – that Nasdaq is holding those assets is a first step to offering additional services that clients can tap into if they wish to transfer or trade their cryptocurrency holdings.

“Custody is foundational,” Cohen explained to Bloomberg. “Off the back of custody, we can start to develop other solutions, offer execution services, liquidity services and think about how we support new markets.” Cohen did note that while Nasdaq has no immediate plans to launch a cryptocurrency exchange, it would evaluate the opportunity based on the competitive landscape and regulator environment.

Nasdaq’s move into crypto custody services will see it compete with companies including Coinbase Inc., Anchorage Labs Inc. and BitGo Inc.

The potential that Nasdaq may later pursue cryptocurrency exchange services comes as Wall Street heavyweights back a new exchange that aims to bring traditional finance to digital asset trading through intermediaries.

EDX Markets launched on Sept. 13 with the backing of Charles Schwab Corp., Citadel Securities, Fidelity Digital Assets, Paradigm, Sequoia Capital and Virtu Financial. In an interview with CoinDesk, Chief Executive Officer Jamil Nazarali said that the exchange will service institution accounts and industry “long-term players” who are “not investing to make a quick buck.”

Photo: Flickr

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