State Street Financial Center building that houses the company’s headquarters in Boston, Massachusetts.
Brent Lewin | Bloomberg | Getty Images
State Street is launching a digital finance division that will include cryptocurrency, central bank digital currency, blockchain technology and tokenization, it announced Thursday morning.
State Street Digital will be integrated with their proprietary electronic trading platform, which the bank aims to develop into one that can support crypto assets as well as other asset classes.
“We see digital assets as one of the most important forces shaping our industry over the next five years,” said Ron O’Hanley, chairman and CEO of the company, in a statement Thursday, adding that “digital assets are rapidly falling into place the existing framework can be integrated “. of financial services “and that the company wants to be ready to serve customers when their appetites grow.
While institutional interest in Bitcoin has fueled its recent bull run, the largest cryptocurrency by market cap carries multiple risks and skeptics are still cautious about investing in it. Among them, cryptocurrencies and the companies that provide services around them are largely unregulated, and many investors might look to traditional custodians or advisory platforms to assist them prior to allotment.
Additionally, some investors are keen to see the Securities and Exchange Commission approve a Bitcoin ETF, but that likely won’t happen this year. Speaking to CNBC’s Bob Pisani on Wednesday, SEC chairman Gary Gensler reiterated comments that investors in crypto markets do not enjoy the full protection they have in stock markets.
State Street, which has $ 3.6 trillion in assets under management and $ 40.3 trillion in assets under custody, is the second of the top five global custodians to introduce a digital asset service. BNY Mellon is also planning to offer crypto asset services to customers this year.
Nadine Chakar, Head of Global Markets at State Street, will lead the division and report to Chief Operating Officer Lou Maiuri.
The bank also said the division plans to create new liquidity locations for our customers and investors. Earlier this year, it gave its forex technology to a start-up called Pure Digital, an interbank digital currency trading venue that aims to be the institutional crypto trading platform.