Nasdaq, Inc. is gearing up to launch its digital asset custody services by the end of Q2, adding to the growing list of traditional financial institutions stepping in as crypto middlemen.
The move comes as the industry suffers from a string of bankruptcies. Nasdaq’s senior VP, Ira Auerbach, confirmed that the group is working on obtaining regulatory approval and building the necessary technical infrastructure to enable it to offer the service.
Nasdaq has applied to the New York Department of Financial Services for a limited-purpose trust company charter to oversee the business. This marks the company’s first major foray into crypto.
The initial step will be to provide safekeeping for Bitcoin and Ether, with plans to extend services to include execution for financial institutions. BNY Mellon and Fidelity are already among the large financial firms offering crypto safekeeping.
Meanwhile, others are focusing on tokenizing traditional assets like bonds to benefit from crypto’s underlying technology, which could make trading and processing the assets more efficient.
The cryptocurrency market witnessed a series of bankruptcies that eventually led to the downfall of the FTX exchange in November. The collapse of the preferred digital asset exchange for trading firms and professional investors has opened the doors for traditional finance firms, including Nasdaq, to step in and fill the void.
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