Institutional Clients take Advantage of TradeFi.
America’s oldest bank BNY Mellon’s select institutional clients will be able to hold and transfer Bitcoin and Ether through its new crypto custody offering. Nasdaq is looking to offer similar services. State Street, a Boston-based firm, is also working towards expanding its crypto custody plans.
Talia Klein, BNY Mellon’s head of digital asset custody commercial product, said they are seeing a lot of institutional interest in crypto. He believes people require an institutional-grade provider. BNY Mellon, in its latest research report, stated that 70% of institutional investors surveyed would increase their digital asset activity if services like custody and execution are available from recognized and trusted institutions. The report outlined that institutional investors are more concerned about getting into crypto in a safe and compliant manner.
Matthew Savarese, vice president and global head of strategy at Nasdaq, said everyone was worried 12 months ago about how to get into the space in the quickest way possible. He pointed out that with the so-called crypto-winter, people are taking a step back to look at information security, market fragmentation, and liquidity, and understand what credit intermediation is, and what quality execution looks like.
Savarese said more options are available now from both traditional financial institutions and crypto-native companies. But the current regulatory environment is weighing on institutional investors and slowing their entry into the space. However, the industry is rapidly evolving.