Nasdaq, a cryptocurrency exchange operator said it intends to launch its custody services for digital assets like bitcoin by the end of the 2023 second quarter.
The company moves into the industry after a series of failures such as the bankruptcy of FTX, one of the largest cryptocurrency exchanges.
The exchange operator is among those traditional financial firms that want to play a role as intermediaries in the crypto sector which saw the collapse of some major players.
The group is now working to obtain the necessary approvals from regulatory bodies that will allow it to provide such services, Bloomberg reported on Friday, quoting Ira Auerbach, senior vice president and head of Nasdaq Digital Assets.
Nasdaq has already applied to the New York Department of Financial Services for a limited-purpose trust company charter, which would oversee the new crypto business, the executive revealed in an interview in the French capital.
The initiative was first announced in September. It represents the first inroad into the crypto economy for the company which runs the second-largest American stock exchange by market capitalization of the traded shares.
The project’s implementation will begin with the safekeeping of the leading cryptocurrencies, bitcoin (BTC) and ether (ETH), before expanding the range of services provided by the group’s digital assets division. The plan is to provide execution for financial institutions eventually.
The crypto winter caused by falling prices had an impact on banks exposed to digital assets, resulting in the failure of crypto-friendly Silvergate Bank and Silicon Valley Bank in the United States.
Nasdaq will join large financial firms such as BNY Mellon and Fidelity in the crypto market, offering custody for cryptocurrencies, intermediary services, or tokenization of traditional assets to capitalize on the benefits of related technologies.