Standard Chartered Enters Crypto Custody Business, Targets Year End Pilot Launchby Fintech News Singapore August 3, 2020
Standard Chartered is the latest bank to get into the crypto custody business, unveiled earlier this month that its innovation, ventures and fintech investments unit, SC Ventures, has been working on a solution for the institutional market that would support cryptocurrencies such as bitcoin but also security tokens, according to a CoinDesk report. The first pilot of the service could launch before the end of the year.
Alex Manson, the head of Singapore-based SC Ventures, told the media outlet that the firm has been developing “one of the most secure crypto custody solutions on the market,” adding that as many as 20 institutions had expressed interest in the solution.
Though the venture will be based in the UK, it will be open to clients from around the world, Manson said.
With this new offering, he said the firm was looking to provide institutional investors with a custodial solution that caters to this segment’s specific needs notably in terms of security, citing features such as segregated accounts. This could potentially kick-start the institutional adoption of cryptocurrencies, Manson said.
The news comes on the heels of the announcement of Standard Chartered’s participation in Metaco’s US$17 million Series A funding round announced earlier this month. Metaco is a Swiss crypto startup providing custodial services for the institutional market.
Commenting on the funding round, Manson said SC Ventures has been “developing a venture to meet the demands of institutions for an end-to-end institutional grade custodian of digital assets, which meets regulatory standards.” Manson added that the partnership and investment in Metaco “will provide both ease of use and uncompromising security.” He later told CoinDesk that Metaco would be one of the key technology providers for the new venture.
Crypto custody services multiple in Asia
Often called the world’s leader in crypto and blockchain adoption, Asia has witnessed a spike in new crypto custody solutions being launched.
Earlier this week, Singapore-based crypto exchange Huobi launched a digital asset custody platform targeted at accredited investors and institutions. Huobi is the world’s second largest cryptocurrency exchange by volume.
In January, French digital asset storage provider Ledger unveiled a partnership with South Korean blockchain platform Fleta to provide custodian services. Glenn Woo, Ledger’s managing director leading business expansions in the Asia-Pacific (APAC) region, told CoinDesk that the partnership was reflective of the company’s shift in Asia towards large-scale institutional clients. Ledger is originally known for its hardware crypto wallets but has been looking to extending its reach to institutional investors.
According to Digital Assets Custody, there are about a dozen crypto custodians across Asia, most of which being located in Hong Kong where the Securities and Futures Commission introduced last year a regulatory framework for so-called Virtual Asset Fund Managers. The framework dictates how fund managers investing in virtual assets must deal with the custody of virtual assets, counterparty risk, and more.
Since then, several crypto custodians opened their doors, including Aegis Custody, OSL, Hex Trust, and First Digital Trust, the digital asset custody arm of financial services company Legacy Trust which raised US$3 million in March this year.
In Singapore, digital asset firm Matrixport offers a crypto custody offering called Cactus Custody. There are also Davos Custody, and Propine, which claims to be the first independent digital asset custodian to be granted a Capital Markets Service License by the Monetary Authority of Singapore (MAS).
Featured image credit: Standard Chartered Bank