State Street’s launch of a digital assets unit was followed closely by State Street Digital launching fund services for digital assets and cryptocurrencies. The investment and institutional custodian firm has $3.5 trillion in managed assets and is set to become even bigger with its latest additions.
The tools for digital asset fund administration will be offered for private fund clients in partnership with Lukka, a well-known crypto data services firm. Lukka prime pricing data and reference data will be utilized by State Street along with back and middle office tools for data management. This will help the company to provide reporting and reconciliation services. The purpose of the new services is to add digital assets to traditional portfolios.
State Street also happens to be one of Lukka’s main investors. It was a participant of Lukka’s Series C round of funding in December 2020, during which Lukka raised $21 million. To this day, Lukka has raised $99 million and its market valuation stands at $200 million. Another major investor in Lukka is S&P Global, which is partnering with the company on indices of crypto-asset prices.
State Street Digital isn’t a lone ranger in terms of making the move into the world of digital assets. Many prominent Wall Street banks are now offering a variety of crypto products as well. For example, JPMorgan is now providing access to crypto funds for select clients. Morgan Stanley was yet another prominent bank to give select clients access to funds that have Bitcoin exposure. Goldman Sachs also entered the crypto market earlier this year when it announced that it would offer crypto trading to hedge funds and institutional clients.