Coinbase Rolls Out Crypto Custody Product for Institutions

Coinbase Rolls Out Crypto Custody Product for Institutions

The exchange is launching Coinbase Prime - a new platform specifically created to provide large institutional investors with a suite of tools for trading cryptocurrencies.

Because of this new demand, the cryptocurrency exchanges of the world are competing for this new market.

Recently, a huge number of hedge funds revealed their plans to go in for crypto trading and investing which is an evidence of growing attention to the crypto sphere from the side of institutions and financial services companies.

The storage feature, called Coinbase Custody, is accepting applications as of Tuesday. Coinbase has partnered with an SEC-regulated broker-dealer to create Coinbase Custody and offer a service that couples Coinbase cryptocurrency security excellence with third-party auditing and financial reporting validation that tends to operate a high standard of and SEC-regulated, custodial broker-dealer. Essentially, what Coinbase will be doing via this office is upgrading its systems so that it can become one of the first crypto exchanges that supports high frequency trading (HFT). Lost or stolen crypto funds will likely never be recovered, and this puts institutional investors on edge.

"We really pride ourselves on being the most trusted, the most secure venue, within the cryptocurrency space", said Eric Scro, Coinbase's vice president of finance. Coinbase has already gained experience in storing over $20 billion of cryptocurrency on behalf of customers but earlier it hasn't had a separate product for storing holdings. Coinbase Markets will introduce new features such as on-premise datacenter location, institutional connectivity and access, low latency performance, and settlement and clearing services over the year.

The launch partners of this new platform will be 1confirmation, Autonomous Partners, Boost VC, MetaStable, Multicoin Capital, Polychain Capital, Scalar Capital and Walden Bridge Capital.

Coinbase Markets is a centralized liquidity pool for all Coinbase products, which, besides Coinbase's digital wallet and exchange, include trading platform GDAX and now Prime.

Coinbase Prime is a new set of services which Coinbase says will "fill a missing piece of critical infrastructure needed for institutions" that wish to add cryptocurrencies to the roster.

Coinbase is targeting institutional investors with four new product offerings - Coinbase Custody, Coinbase Prime, The Coinbase Institutional Coverage Group and Coinbase Markets. Coinbase Prime will be offering lending and margin financial products, Over the Counter [OTC] trading, and algorithmic orders along with the recent market data and research products.

By guiding clients through the onboarding process and advising on execution strategies, the Coinbase Institutional Coverage Group will offer personalized white-glove service and help institutional investors navigate the increasingly complex world of crypto asset investing.