The battle for custody of cryptoassets from institutional investors is heating up.
Cryptocurrency exchange Gemini is the latest company to test the waters with the launch of Gemini Custody, a qualified custodian of cryptoassets in New York. The solution is aimed at institutional investors and enables them to trade crypto instantly in a secure manner using multi-sig authentication.
“Institutional investors have demonstrated a clear and growing demand for crypto, but they’ve struggled to find a solution that fully meets their complex regulatory and security requirements,” said Jeanine Hightower-Sellitto, managing director of operations at Gemini. “Gemini Custody is the only crypto-native solution in the market today that meets these complex requirements without sacrificing security or liquidity.”
At its start, Gemini’s offering will offer custody services for 18 cryptocurrencies, including Bitcoin and Bitcoin Cash, and 13 ERC-20 tokens, the most popular form of tokens on Ethereum’s blockchains. Tokens included in Gemini’s custody solutions are 0x, Basic Attention Token (BAT), and others.
The solution will also enable instant trades or trading for stored cryptocurrencies without the time lag generally required to retrieve the stored cryptoasset and make it available for trading. While Coinbase Custody also offers instant trades, they are limited to OTC desks.
In a conversation with online publication The Block, Hightower-Sellitto said they were the first ones to offer liquidity from a regulated exchange order book. She said the trades were made possible through “super liquid hot wallets” which credit the exchange account with the trading balance amount. The custody solution, meanwhile, initiates the regular process for retrieval of assets in the background.
Gemini’s announcement comes amidst a flurry of activity in the custody landscape. North America’s biggest exchange Coinbase acquired Xapo to boost its offerings for institutional investors while Bakkt, a long-awaited futures trading platform backed by NYSE owner ICE, announced the launch of its custody offering yesterday.