- US regulatory authority approves BitGo status of a custodian for crypto.
- The market is growing amid a flood of positive news.
Cryptocurrency security startup BitGo has received a status of a custodian for crypto, and other digital assets as The South Dakota Division of Banking approved the company's request for permission to act as a digital asset custodian. The company will offer its clients a regulated custody solution developed specifically for their crypto investments.
Currently, Bitcoin offers an online 'hot wallet' solution, which can be downloaded and used for secure digital assets storage. Apart from that, BitGo has a custodial solution that combines hot and cold wallet, though it is not regulated.
"The trust company will enable us to offer a qualified custodial offering that is regulated, that has the money laundering and know your customer requirements. Our custodian offering already has money laundering and KYC requirements … [but the Trust is] for institutional clients … especially for those who are registered advisors and broker-dealers," BitGo's chief compliance and legal officer Shahla Ali explained in the interview with CoinDesk.
The new offering targets primarily institutional investors, as custodial services will allow them engaging into cryptocurrency market and comply with the regulatory requirement to custody the assets.
While BitGo Trust was approved by South Dakota regulators, the company believes that other states won't stop it from operating in their respective jurisdictions.
The news added to the positive drive on the cryptocurrency markets, creating a favorable environment for an extended recovery from the recent slump. Bitcoin is changing hands at $6,550 at the time of writing, Ethereum is trading at $220, gaining 15% since this time yesterday, while XRP has settled at $0.2830.