Nasdaq Establish New Digital Biz, To Offer Custody Services for Cryptocurrencies including Bitcoin and Ethereum
With this new digital business, Nasdaq has indicated
that it is ready to offer custody services for cryptocurrencies
including Bitcoin and Ethereum following increased institutional demand. Nasdaq Digital Assets Will Provide a Proprietary Custody Solution with Liquidity and Execution Services for Financial Institutions.
According the Nasdaq’s press release, Nasdaq Digital Assets will initially develop an advanced custody
solution that will incorporate liquidity and execution services to address industry challenges around connectivity, availability, and efficiency.
Nasdaq’s custody solution will bring together the best attributes of hot and cold crypto wallets through an innovative technology offering, which will provide a high degree of accessibility and scalability without compromising security. Nasdaq’s offering is subject to regulatory approval in applicable jurisdictions.
Custody services provided typically include the settlement, safekeeping, and reporting of customers’ marketable securities and cash. The custodian (Nasdaq, in this case) is responsible for the safety of the financial products. With this crypto holders may make additional income on custody assets by loaning cryptos on a short-term basis. In 2022, Wall Street has increasingly taken an interest in cryptocurrencies despite the slump in prices.
Nasdaq, which is the second largest U.S. stock market exchange, has announced the introduction of custody services among its many products. According to a press release by the stock market operator, this move was motivated by increasing institutional interest. Although the post has not specified the digital assets the operator will offer, two obvious coins have captured the attention of institutional investors in the last couple of years- Bitcoin (BTC), and Ethereum (ETH).
For most institutional investors, the two largest cryptocurrencies offer the most network security, price stability, and liquidity to act as introductory investments in the crypto space.
Tal Cohen, head of North American markets at Nasdaq, expressed confidence in the latest venture, noting — “Demand among institutional investors for engaging in digital assets has increased in recent years, and Nasdaq is well-positioned to accelerate broader adoption and drive sustainable growth.”
Bloomberg has since reported that while the company is open to working with native crypto firms, there were no immediate plans to acquire a crypto firm.
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