1. Custody Market
In today’s custodian business, Custody company takes over the business of storing and disposing of various liquid assets and securities. Custody company’s ability to keep assets safe, apply perfect security technology, and handle large volumes of transactions efficiently is essential. Today, four large trust banks (New York Melon, JPMorgan, State Street and Citigroup) offer $114 trillion in custodial services.
As the investment industry has grown over the past 20 years, assets under custodial services have increased dramatically, and the custom business in the cryptocurrency industry has recently grown exponentially in size. For example, CoinBase in the U.S. deposited $1 billion just a year after the launch of its custodian service. Global financial firms such as Fidelity and Goldman Sachs are also active in making inroads. With customers buying custard services that are safer, more convenient and more affordable, and with each country’s cryptocurrency regulations in place, custodian services are required as a necessary service for virtual currency exchanges and STO transactions.
2. The Problem
The advantages of blockchain industry are liquidity and safety. Custody Asset Transactions are controllable and should be guaranteed the safety of the transactions. Traditional custodians, however, have failed to keep up with customers’ demands amid rapid blockchain and changes in IT technology.
Information management is also critical in managing an investor’s assets. Numerous records exist in custodian business, including investor personal information, invoice, wallet address, balance and trust history. There are cases in which such key information is still managed by centralized servers and is abused by hacking.
Investors are required to manage their assets spread across various exchanges. There is an inconvenience of having to pay huge fees and time to customize cash and cryptocurrency. Also, users in non-dollar countries have the difficulty of exchanging money with dollars each time because they are paid on a dollar basis.
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