Core Insights - BitGo positions itself as the only provider offering all custody options described by the SEC, following its recent regulatory approval to operate as a bank, which enhances its institutional services [2][4]. Group 1: Custody Options - BitGo allows institutions to combine self-custody and third-party custody into a single hybrid strategy, creating custom risk profiles that are unique to its platform [3][4]. - The SEC bulletin outlines two primary models of crypto custody, but BitGo enables clients to utilize both models simultaneously, providing flexibility [4]. Group 2: Asset Storage and Security - Under BitGo's framework, 90% of client assets can be stored in BitGo Trust cold storage, ensuring regulatory compliance, insurance, and security, while the remaining 10% can be in self-custody hot wallets for operational flexibility [5]. - This hybrid approach reduces single points of failure, as assets in the trust remain safe even if self-custody keys are lost, unlike traditional exchanges that risk freezing all funds during insolvency [5]. Group 3: Regulatory Compliance and Insurance - BitGo Bank & Trust, NA, a federally chartered national bank, supports the platform's third-party custody solution and is subject to regular SOC 1 Type 2 and SOC 2 Type 2 audits [6]. - The bank supports over 1,400 coins and tokens under segregated accounts, backed by a $250 million insurance policy from Lloyd's of London syndicates [7]. - BitGo maintains strict 1:1 custody standards, ensuring that client assets are not rehypothecated, lent, or commingled [7].

SEC-Registered Crypto Platforms. Photo by BeInCrypto The US Securities and Exchange Commission (SEC) has issued new guidance to help retail investors better safeguard their cryptocurrency holdings. On December 12, the SEC’s Office of Investor Education and Advocacy published an Investor Bulletin. The document outlines standard crypto custody models and the risks associated with holding digital assets. SEC Warns Retail Investors About Hidden Crypto Custody Risks The SEC’s emphasis comes as the business ...

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Core Insights - Standard Chartered has expanded its partnership with OKX to provide a custody solution for institutions in the European Economic Area, allowing them to trade crypto without direct deposits to an exchange [1][6] - The custody service is designed to minimize risk for institutions making large trades, as it secures assets with bank-grade custody [2][4] - The partnership aims to build institutional trust in crypto trading, especially in light of past incidents like the FTX collapse, which have made institutions wary of platform risk [4][6] Group 1 - The custody solution enables institutions to trade crypto while their assets are secured by Standard Chartered, enhancing trust in the trading process [1][6] - The partnership initially launched in the UAE and targets institutions making eight- or nine-figure trades, addressing their concerns about risk exposure [2] - OKX provides liquidity by mirroring crypto deposits on its platforms, ensuring that institutions can trade effectively while their collateral is secured [3] Group 2 - The ability to trade large amounts of crypto without relying on a centralized exchange is appealing to institutions concerned about security [4] - Institutional trust in crypto exchanges has been diminished due to previous hacks and insolvencies, making this new product a significant development [4] - The new custody solution is expected to mitigate risks and restore confidence among institutional investors in the crypto market [4][6]

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Core Viewpoint - Coinbase is seeking to expand its services by applying for a national trust company charter, aiming to enhance its custody business while maintaining regulatory clarity and oversight [2][3][4]. Group 1: Expansion Plans - The application for the charter with the Office of the Comptroller of the Currency (OCC) is intended to build on Coinbase's custody business and facilitate the launch of new products, including payments and related services [2][3]. - Coinbase emphasizes that it does not intend to become a bank, focusing instead on innovation within a clear regulatory framework [2][4]. Group 2: Regulatory Environment - The company advocates for uniform rules and regulations for the cryptocurrency market, highlighting the ongoing efforts in Congress to establish a clear market structure [4]. - An OCC charter would streamline oversight for new offerings and support the integration of digital assets into traditional finance [4]. Group 3: Market Position - Coinbase holds over 80% of the custody market share for crypto ETFs, indicating a significant role in the institutional adoption of cryptocurrency [5]. - The growth of institutional-grade custody needs is driven by the increasing institutionalization of crypto markets, particularly with the introduction of spot bitcoin ETFs [5][6]. Group 4: Market Impact - The approval of spot-crypto ETFs by the Securities and Exchange Commission has led to explosive growth in the market, with BlackRock's iShares Bitcoin Trust reaching a market capitalization of approximately $90 billion [6].