Alexandre Kech, CEO of Onchain Custodian, predicted that collaboration between crypto and traditional custodians will grow. Kech’s remarks came during a panel called “Custody: The New Global Competitive Landscape,” part of Consensus 2019 on May 14.
Kech observed that crypto custodians are much better at adding new token support to their wallets and are willing to hold a variety of crypto assets. “We have the agility, both in terms of compliance and technology, to deploy those coins way faster.”
By Kech’s reasoning, traditional custodians are often reluctant to take on new coins due to institutional barriers. They partner with crypto custodians so that they can gain access to these assets for their customers. Meanwhile, the crypto custodians benefit from these arrangements because customers who may be cautiously interested in crypto assets are more willing to invest in them if they can do so via a trusted bank or custodian.
Fellow panelist Matt Jennings, CEO of Kingdom Trust, said that his organization has “worked with the large, traditional custodians for a long time.” Jennings noted that these institutions are inherently conservative, saying “Their offerings are limited. They are for a limited group of customers and they typically own a limited group of assets and I don’t see that being any different in crypto space.” Given these limitations for each individual custodian, Jennings sees space for everybody.
CEO of Coinbase Custody Sam McIngvale agreed with the other speakers, adding that selling custody is ultimately selling “trust and a track record.”
As Cointelegraph previously reported, the lack of trusted custodial solutions remains a deterrent to potential professional and institutional investment in crypto assets.
In recent encounters between traditional financial institutions and crypto custodians, the Intercontinental Exchange (ICE), operator of the New York Stock Exchange, was reportedly considering licensing its crypto custodial platform the Digital Asset Custody Company (DACC) in New York as of early May.
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