Nasdaq Waiting on Approval to Provide Crypto Custody for Clients

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Last Updated on March 27, 2023 by Bitfinsider

Nasdaq is betting that its established reputation will help it achieve a strong position in the crypto world.

The 52-year-old exchange operator is waiting for approval from the New York Department of Financial Services to begin providing custody to clients by the end of June. Following the failure of Three Arrows in July, Nasdaq declared its plan to enter the cryptocurrency market, and has continued to do so despite the drop in cryptocurrency prices and the subsequent bankruptcies of FTX, Voyager Digital, Celsius Network, and others.

“Trust had started to break down a little bit, and they really needed that trusted player to come in,” said Matt Savarese, Nasdaq’s director of strategy for digital assets, on The Scoop podcast, which was taped in Paris.

The upheaval caused the business to reconsider its decision to enter the space.

“We’re on the right track,” said Savarese. “Having that foundational aspect of custody was absolutely critical, and we see institutions not backing away from the space, but instead looking for players like us to say, great, they know how to deliver it.” They’ve been doing it for over 50 years. They’re also creative in terms of regulation.”

It’s not an easy moment to be seeking regulatory approval to operate in the crypto space. US authorities have repeatedly cracked down on crypto-related businesses. Among the actions taken, the NYDFS ordered crypto infrastructure company Paxos to stop issuing the stablecoin Binance USD in February. In addition, the US Securities and Exchange Commission sent Coinbase a Wells notice last week, informing the firm of investigations into several offerings.

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