Nasdaq to custody bitcoin and ethereum for institutional clients

Nasdaq Inc., the world’s second largest stock exchange, is planning to offer crypto custody and other services as institutional appetite for crypto grows.

Wall Street is eyeing up the crypto sector in spite of the downturn over most of this year. This has encouraged Nasdaq to build out a new group for digital assets that will initially offer custody services for bitcoin and ethereum to institutional investors.

The digital assets unit will be headed up by Ira Auerbach, who previously ran Gemini’s prime broker services. The new entity will be called Nasdaq Digital Assets, and will seek to build a team from both internal and external candidates. It is looking to hire around 40 people by year-end.

Auerback said in an interview:

“We believe this next wave of the revolution is going to be driven by mass institutional adoption. I can think of no better place to bring that trust and brand to the market than Nasdaq.”

Nasdaq exec Tal Cohen said in another interview:

“Custody is foundational. Off the back of custody, we can start to develop other solutions, offer execution services, liquidity services, and think about how we support new markets.” 

Cohen was also reported to have said that although the exchange provider was not yet ready to launch a crypto exchange, it will continue to evaluate the crypto landscape as the regulatory and competition factors evolve.

In his view though, the changing regulatory environment should offer advantages and opportunities to Nasdaq. He stated:

“We know how to operate under regulatory regimes, and we continue to innovate under the rules of the road. Embracing regulation as it comes is something we do. And institutions want us to operate under that framework.”

According to an article on Bloomberg, the move will see Nasdaq competing in institutional crypto services with the likes of Coinbase, Anchorage Digital, and Bitgo, as well as BNY Mellon and State Street from the traditional finance sector.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.