The cryptocurrency landscape is evolving rapidly, and with it, the need for secure and reliable custody solutions for institutional investors. In a significant development, OKX, a leading cryptocurrency exchange, has partnered with Standard Chartered Bank to offer third-party crypto custody services. This strategic alliance marks a pivotal moment in the integration of digital assets within the traditional financial ecosystem.
OKX’s decision to appoint Standard Chartered as a third-party custodian is a testament to the bank’s robust risk management framework and extensive global banking expertise. The partnership aims to provide institutional investors with a broader range of secure and reliable custody solutions, enhancing OKX’s comprehensive suite of institutional services, which already includes advanced trading capabilities and robust risk management tools.
The collaboration is expected to attract increased institutional participation in the digital asset market, contributing to a more mature and developed environment for institutions globally. This move aligns with the findings of a recently published OKX-commissioned research brief by Economist Impact, which highlights institutional investors’ view that digital assets are an inevitable institutional opportunity. The report also finds that 80% of traditional and crypto hedge funds utilizing digital assets employ third-party custodians, underscoring the strong demand for segregation of duties related to trade execution and asset custody.
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Standard Chartered’s commitment to offering custodial services that meet the highest standards of safety and compliance is a significant advantage for OKX. Serving as OKX’s third-party custodian allows Standard Chartered to extend its expertise into the evolving cryptocurrency sector, providing institutional investors with the assurance they require in managing their digital assets.
This partnership comes at a time when the regulatory landscape for digital assets is becoming increasingly favorable. Standard Chartered has recently launched its crypto custody services in the United Arab Emirates, a market characterized by a balanced approach to digital asset regulation. The bank received a license from the Dubai Financial Services Authority (DFSA) on September 10, further solidifying its position in the industry.
Interestingly, Tether has minted an additional $1 billion USDT on the Tron blockchain. This move comes as part of Tether’s ongoing efforts to maintain liquidity and meet the demand for its stablecoin across various networks. The minting of such a large amount of USDT is not uncommon for Tether, as the company has been known to create large sums of its stablecoin to ensure a stable supply for future issuance requests and chain swaps.
The decision to mint on the Tron network, in particular, highlights the growing demand for USDT within this ecosystem. Tron has been leading the stablecoin supply market, commanding a significant percentage of the total stablecoin market share. This latest minting brings the total USDT minted in the last year to an impressive $33 billion, with a substantial portion on the Tron network.
Tether’s approach to minting ‘authorized but not issued’ tokens allows for a more secure and efficient process, reducing exposure to security threats and ensuring that tokens can be issued instantaneously once customer funds are received. This strategy is crucial for maintaining the peg of USDT to the US dollar and for providing the necessary liquidity in a fast-paced and volatile market.
The OKX and Standard Chartered Bank partnership is a clear indicator of the growing recognition of cryptocurrency as a legitimate and valuable asset class among traditional financial institutions. It also reflects the ongoing efforts to bridge the gap between the innovative world of digital assets and the established realm of traditional finance. As the industry continues to mature, such partnerships are likely to become more common, paving the way for a more secure and regulated cryptocurrency market.
