The Exchange Group is working to establish the necessary technical infrastructure and obtain regulatory approvals
The NASDAQ has begun preparations to launch custody services for crypto holders by the end of the second quarter of 2023, according to Bloomberg . The exchange group is working to build the necessary technical infrastructure and obtain regulatory approvals, said Ira Auerbach, head of NASDAQ Digital Assets, a digital asset division.
As it joins a growing list of traditional financial institutions that could play the role of crypto middlemen in the wake of a wave of bankruptcy filings in the industry, Nasdaq Inc. anticipates its custody services for digital assets to start by the end of the second quarter.
According to Ira Auerbach, senior vice president and head of Nasdaq Digital Assets, the global exchange group is moving quickly to put all the required technical infrastructure and regulatory permissions in place. He made this statement during an interview in Paris. In order to manage the new company, Nasdaq has submitted an application for a limited-purpose trust company charter with the New York Department of Financial Services.
Custody services are banking services for storing valuable assets such as stocks, bonds, money, precious metals and cryptocurrencies. A company that provides custodial services can offer its clients loans, foreign exchange transactions, settlement of transactions, and much more.
NASDAQ has filed an application with the New York City Department of Financial Services (NYSDFS) to process the appropriate paperwork for a company that will be in charge of the cryptocurrency business. According to Auerbach, this project will be the first major entry of the exchange operator into the cryptocurrency market.
At first, the company plans to provide storage services for bitcoin and Ethereum. Then the package of services will be expanded and eventually will include the execution of transactions for financial institutions.
Previously, NASDAQ has already participated in cryptocurrency projects. In May 2022, it partnered with Brazilian firm XP to create the XTAGE digital asset exchange.
According to Lucas Rabechini, Director of Financial Products at XP Inc., “At XP, we are driven by our aim to democratize access to investments, offering clients with an enlarged and diverse portfolio of financial products that are at the forefront of global innovation.” “The launch of XTAGE marks a significant step forward in the development of the digital asset market and our capacity to provide investors with expanded access to the developing ecosystem. We are certain that XP will function on a cutting-edge and reliable capital market infrastructure thanks to the technical relationship with Nasdaq, he says.
Bruno Constantino, chief financial officer of XP Inc., said, “We approach this market with a strong team of diversified talent, skill-sets, and experiences, which further enables us to efficiently cooperate with industry leading partners and develop this platform in record time. At the time of introduction, our 3.5 million current customers will have immediate access to the trading platform through the already-used app.
