German crypto services firm Blocknox is to extend its offering to include crypto custody for institutional players, in a move expected to encourage more institutions to hold and trade in digital assets.
Blocknox, a subsidiary of leading German stock exchange Boerse Stuttgart, currently provides crypto custody on an “escrow basis”. The service will now be available to companies using the exchange’s BISON app, as well as users of its BSDEX digital assets exchange, Finextra reported.
The service will become available to a number of banks and asset management companies, offer secure storage for cryptocurrencies and other digital assets.
Dr. Ulli Spankowski, managing director of Blocknox, said the move would help institutional investors benefit from Blocknox’s expertise in cryptocurrency and digital assets: “Now we want institutional clients to benefit from our experience and set-up as well. They can use Blocknox’s reliable custody as a building block for their own services around digital assets.”
Crypto custody services are often an essential precursor to regulated investors entering digital asset markets, with security a paramount concern for banks and financial institutions.
At the core of Blocknox’s offering is a “multilevel security concept”, to safeguard stored cryptocurrencies on behalf of its clients.
The crypto custody from Blocknox is expected to help institutional investors move into digital assets for the first time.
New laws introduced in Germany earlier this year mean Blocknox must soon apply for a license from regulators to offer its service in the country. However, having notified financial regulators of its intention to apply, Blocknox is now able to offer the services on a provisional basis, pending its license application at a later date.
Spankowski welcomed the new regulations, which he said would lead to “further professionalisation” within the cryptocurrency and digital assets sector.
The rules are designed to address the key concerns of institutional investors, as well as service providers within the industry. Companies have until November to be granted a license to offer crypto custody within Germany.
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