BNY Mellon to Offer Crypto Custody for ETPs Following SEC Liability Exemption
- Th Bnk of Nw York Mllon is st to lunch crypto custody for xchng-trdd products, following SEC rviw pprovl.
- BNYs xmption from SAB 121 mrks significnt victory, nbling thm to offr custody without clssifying ssts s libilitis.
- Dspit SEC pprovl, BNY must scur dditionl rgultory pprovls to xpnd its crypto custody srvics ffctivly.
Th Bnk of Nw York Mllon (BNY) is nring th lunch of crypto custody for xchng-trdd products (ETPs). This significnt dvlopmnt follows rcnt rviw by th Scuritis nd Exchng Commissions (SEC) Offic of th Chif Accountnt (OCA) tht xmptd BNY from clssifying sfgurdd crypto ssts s libilitis on its blnc sht.
This xmption from Stff Accounting Bulltin (SAB) 121 is mjor win for BNY. Th rul, dsignd to ddrss risks in th crypto sctor, hd prviously stoppd mny bnks from offring digitl sst custody. BNY, howvr, succssfully dmonstrtd tht holding crypto for its rgultd ETP clints should not b considrd finncil burdn.
BNY hs clrifid tht th ccountncy offics dcision is spcific to th finncil institutions us of xchng-trdd products (ETPs). This ruling, however, does not fully ddrss th widr limittions of SAB 121 rgrding bnks bility to hold digitl ssts. BNY indictes thir intnt to ngg th OCA on dditionl us css through th fcts nd circumstncs procss.
Th SEC hs rportdly grntd similr xmptions to slct finncil institutions in rcnt months. Crtin brokr dlrs nd custody bnks hv sufficintly dmonstrtd to SEC stff tht thir fct pttrns r diffrnt from thos dscribd in SAB 121, xplind n SEC spoksprson. Howvr, th protction of customr ssts during bnkruptcy rmins priority. Th SEC mphsizd tht protction for crypto ssts must b quivlnt to xisting custody rrngmnts.
BNYs Path to Crypto Custody
Dspit rciving SEC pprovl for custody, BNY still nds to gin th grn light from othr rgultors bfor xpnding its srvics. BNY told Bloombrg tht BNY hs bn ctivly working with its bnking rgultors nd will continu to do so in ordr to provid lrg-scl custody srvics to crypto ETP clints.
In 2022, BNY nnouncd its digitl sst custody infrstructur, but fcd dlys du to SAB 121. Prsidnt Bidns vto of ttmpts to ovrturn SAB 121 rlir this yr ddd furthr complxity. Howvr, BNYs xmption indicts potntil chng in rgultions.
BNY, mjor plyr in finnc with ovr $50 trillion in ssts undr custody, ss growing dmnd for rlibl custodins. Currntly, BNY supports 80% of SEC-pprovd Bitcoin nd Ethr xchng-trdd products through its fund srvics, iming to nhnc clint srvics with digitl sst custody.
Th lunch of spot Bitcoin ETFs in th US this yr highlights th potntil of crypto custody. Ths products, from firms lik BlckRock nd Fidlity, hv mssd $58 billion in ssts, with Ethr quivlnts ttrcting ovr $7 billion. BNYs mov into this spc will hightn comptition ginst stblishd custodins lik Coinbs Globl Inc.
Related Related | Altcoin Surge Looms as Bitcoin Dominance Faces Potential Downside Break
Read more: https://www.tronweekly.com/bny-mellon-to-offer-crypto-custody-for-etps/
Text source: TronWeekly
