Nasdaq plans to introduce its custody services for digital assets, such as bitcoin, by the conclusion of the current year’s second quarter. As a traditional financial institution, the exchange operator intends to act as an intermediary in the cryptocurrency market, filling the gap left by some major companies that have ceased their operations.
Nasdaq Awaits Regulatory Green Light To Offer Crypto Custody Services
Nasdaq, a U.S. exchange operator, intends to introduce its own custody services for crypto assets by the end of June. Following a string of setbacks, including the closure of one of the biggest cryptocurrency exchanges, FTX.
According to a report from Bloomberg on Friday, which included Ira Auerbach, senior vice president and head of Nasdaq Digital Assets, the company seeks to secure the regulatory clearances required to offer these services.
The executive confirmed that Nasdaq had submitted an application to the New York Department of Financial Services for a limited-purpose trust company charter that would oversee its new cryptocurrency firm. The initiative was launched in September and marks the first foray into the crypto economy for the organization behind the second-largest US stock exchange by market capitalization.
The plan is to start by securing the top two cryptocurrencies, bitcoin, and ether, and then expanding the range of services provided by the digital assets division of the company. The ultimate aim is to offer execution services to financial institutions.
The decline in cryptocurrency values during the crypto winter had a negative impact on banks that dealt with digital assets, including Silicon Valley Bank and Silvergate Bank in the US, which were forced to close down.
Nasdaq plans to capitalize on the benefits of digital asset technology by providing services such as custody for cryptocurrencies, intermediary services, and tokenization of traditional assets in the cryptocurrency market. This move puts Nasdaq in league with other prominent financial institutions like BNY Mellon and Fidelity.