With its new crypto custody service, UK-based bank Standard Chartered is an early mover in the institutional adoption of cryptocurrency.
Standard Chartered, a London-based bank, will launch its highly-anticipated crypto custody service in Dubai in the coming months, the company has confirmed.
The service will cater to institutional clients and will store Bitcoin and Ethereum. It’s expected to launch in the first quarter of 2024.
Earlier this year, the bank announced that it had signed a memorandum of understanding (MoU) with Dubai International Financial Centre (DIFC) to collaborate on developing digital assets services, including digital asset custody.
The custody service will be powered by its subsidiary, Zodia Custody, which holds the operational and technical capabilities to facilitate services toward institutional clients.
The company illuminated that the UAE is a far more welcoming jurisdiction than other nations in terms of crypto regulation.
“Back in 2018, when places like Singapore and the UAE were busy consulting on crypto assets, some other regions had not even made the distinction between a security and non-security status when it came to crypto assets,” said Waqar Chaudry, executive director of innovation at Standard Chartered, in an interview with CoinDesk.
“For that reason, now we see the difference in maturity in markets where countries like the UAE, Japan, Singapore and Hong Kong are beginning to move faster,” he added.
Chaudry pointed out that operating in Dubai enables the company to offer services “all over the world, technically speaking”, as the license permits the company to on-board clients from elsewhere.
“So if we have jurisdictional equivalence, and our license allows us to get clients on-boarded from other parts of the world, then we will do so in the interim, until we can actually deploy a local offering into that country,” he said.
The bank also plans on launching a crypto settlement network
Beyond crypto custody, the bank also plans on launching a crypto settlement network, similar to Signature Bank’s Signet and the Silvergate Settlement Network. Both banks have shuttered in the past year, opening a huge market opportunity for other crypto-friendly banks.
“We have existing rails and settlement capability as well as service provision with other traditional custodians; we can service them, we can use them, they can use us,” Chaudry said.
“So that network effect will take hold pretty quickly after entities like us enter the market, rather than depending on a single bank network, unlike what recently failed institutions had built for the crypto market.”
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