{"id":17249,"date":"2024-09-25T09:20:43","date_gmt":"2024-09-25T06:20:43","guid":{"rendered":"https:\/\/forklog.com\/en\/bny-mellon-to-expand-custodial-services-to-spot-bitcoin-etfs\/"},"modified":"2024-09-25T09:20:43","modified_gmt":"2024-09-25T06:20:43","slug":"bny-mellon-to-expand-custodial-services-to-spot-bitcoin-etfs","status":"publish","type":"post","link":"https:\/\/forklog.com\/en\/bny-mellon-to-expand-custodial-services-to-spot-bitcoin-etfs\/","title":{"rendered":"BNY Mellon to Expand Custodial Services to Spot Bitcoin ETFs"},"content":{"rendered":"

The Bank of New York Mellon, with AUM<\/span> of $50 trillion, plans to enter the custodial services market for spot exchange-traded funds based on Bitcoin and Ethereum, representatives of the bank told Bloomberg<\/a>.<\/p>\n

The agency noted that such a move could threaten Coinbase’s dominant position.<\/p>\n

The Bitcoin exchange serves as the custodian for most products, with exceptions being the funds of Fidelity and VanEck. In the latter case, Coinbase acts as an additional partner.<\/p>\n

According to Bloomberg, cryptocurrency custody services can be ten times more expensive compared to TradFi<\/span>, considering the risks associated with their security.<\/p>\n

The digital asset custody market is valued at $300 million, with the potential for annual growth of 30%.<\/p>\n

In 2022, BNY Mellon received regulatory approval to launch a crypto custody service, but legislative constraints in the form of SAB 121<\/span> from the SEC<\/span> made the implementation of this initiative problematic.<\/p>\n

The document effectively made the commercial storage of clients’ digital assets unprofitable.<\/p>\n

\n

The review conducted by the agency’s Office of the Chief Accountant<\/em> did not raise concerns regarding BNY’s proposal not to reflect crypto-ETF collateral on the organization’s balance sheet<\/em>, the statement said.<\/em><\/p>\n<\/blockquote>\n

In addition to the Commission, approval from other regulators, with whom BNY is in dialogue, will be required.<\/p>\n

The SEC issued<\/a> SAB 121 in April 2022. In February 2024, four industry organizations requested<\/a> a relaxation of the document’s provisions. Commissioner Hester Peirce called the Bulletin and related oral guidance a \u201cpernicious weed.\u201d<\/a><\/p>\n

Earlier, Senator Cynthia Lummis and Congressman Patrick McHenry highlighted the increased risks of loss of client funds due to the collapse of a crypto custodian under the rule’s implementation.<\/p>\n

In May, the Senate supported<\/a> a resolution to annul SAB 121. The U.S. House of Representatives passed a bill<\/a>.<\/p>\n

In July, Congress failed to override<\/a> President Joe Biden’s veto on the repeal of SAB 121.<\/p>\n","protected":false},"excerpt":{"rendered":"

The Bank of New York Mellon, with AUM of $50 trillion, plans to enter the custodial services market for spot exchange-traded funds based on Bitcoin and Ethereum, representatives of the bank told Bloomberg. The agency noted that such a move could threaten Coinbase’s dominant position. The Bitcoin exchange serves as the custodian for most products, […]<\/p>\n","protected":false},"author":1,"featured_media":17248,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"select":"","news_style_id":"","cryptorium_level":"","_short_excerpt_text":"","creation_source":"","_metatest_mainpost_news_update":false,"footnotes":""},"categories":[3],"tags":[1229,1682,569,36,128],"class_list":["post-17249","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news-and-analysis","tag-banks-and-fintech","tag-bny-mellon","tag-etf","tag-regulation","tag-sec"],"aioseo_notices":[],"amp_enabled":true,"views":"64","promo_type":"","layout_type":"","short_excerpt":"","is_update":"","_links":{"self":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts\/17249","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/comments?post=17249"}],"version-history":[{"count":0,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts\/17249\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/media\/17248"}],"wp:attachment":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/media?parent=17249"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/categories?post=17249"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/tags?post=17249"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}