Coinbase’s New Custody Service Now Has 10 Clients
Cryptovest
Published Jul 03, 2018 04:43AM ET
Updated Jul 03, 2018 05:01AM ET
Coinbase’s New Custody Service Now Has 10 Clients
Coinbase revealed that ten institutional investors, including hedge funds and family offices, had started using the custody service it launched last week. By the end of 2018, the largest crypto exchange in the US aims to have 100 institutional customers with about $5 billion worth of assets under management. Currently, Coinbase is dealing with $20 billion in crypto funds for retails investors.
The service is designed to protect digital tokens with methods that have been used for traditional securities.
Sam McIngvale, who is in charge of the new custodian service, told Bloomberg the exchange had been in talks with the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (Finra) to make sure its service is in line with requirements.
“We sort of have an understanding with the SEC and Finra, and it allows us to execute contracts with clients and take the first deposits. The company didn’t need an official approval, as it partnered for the service with SEC-regulated broker-dealer Electronic Transaction Clearing,” he said.
Coinbase provides one of the few custodian solutions in an emerging and unregulated market that has been hit by hacker attacks multiple times. Services like these might clean the space and bring in more institutional investors.
Coinbase offers the service for Bitcoin, Bitcoin Cash, Ether, and Litecoin. The company said it planned to cover more cryptocurrencies. Also, it might offer its solutions to exchanges and ICO startups.
One of Coinbase’s new clients is crypto hedge fund Polychain Capital, which had $1 billion in assets as of February 2018.
Polychain Capital CEO Olaf Carlson Wee said:
“Coinbase is incredibly well positioned to store the next $100 billion of crypto assets. [Coinbase] has a very, very long history of successful digital asset storage.”
One of the initial solutions under the new service is to provide cold storage so that hackers cannot find a way to the funds.
In mid-June, we This article appeared first on Cryptovest 
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Written By: Cryptovest
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