BitGo and Swan unveil plans for Bitcoin-only trust company, the best stocks for web 3.0.
BitGo, Swan unveil plans for Bitcoin-only trust company

Exploring Web 3.0 with BitGo and Swan Bitcoin

BitGo and Swan Bitcoin have disclosed plans for a Bitcoin-only trust company, pending regulatory approval. The joint venture will offer services similar to those of a trust company, such as Bitcoin (BTC) custody, administration, and management.

Cory Klippsten, CEO of Swan, explained that the solution is intended to provide Bitcoin custody without the risks associated with having other altcoins under the same roof. He commented, “For years, we’ve heard from major clients, partners, and other Bitcoin companies that they would prefer a Bitcoin-only software and services stack that is focused strictly on the best custody that leverages Bitcoin’s unique features.”

The companies have contacted state regulators about their plans, but have yet to file for regulatory approval. According to Klippsten, “We are evaluating acquisition options first.”

Institutional Investors in the Crypto Space

BitGo offers digital asset security and custody, with support for over 700 cryptocurrencies, according to its website. In comparison, Swan’s business focuses solely on Bitcoin, giving users the option to make one-time or recurring investments with records stored at Fortress Trust and Bakkt, while BitGo provides cold storage custodian services.

The new venture is targeting institutional investors, such as asset managers, pension plans, family offices, governments, and company treasuries. It will supply cold storage, fraud prevention, Anti-Money Laundering and Know Your Customer protocols, as well as other Bitcoin-related services.

Institutional investors in the crypto space are rapidly increasing in the U.S., particularly as the world’s major asset managers seek approval for a Bitcoin exchange-traded fund (ETF). Several well-known Wall Street players are offering cryptocurrency custody solutions to institutional investors, including Bank of New York Mellon and Deutsche Bank.

“We believe there is a high probability that a few ETFs will be approved in 2024, thereby creating a new influx of people to the Bitcoin market looking for experienced, reputable, and technologically proficient partners for various needs,” stated Swan’s CEO. The Securities and Exchange Commission has been delaying decisions on the Bitcoin product, and analysts anticipate the regulator may postpone a decision until the start of 2024 as deadlines approach.

In 2023, Mike Belshe, CEO of BitGo, commented on the joint efforts of the two companies to create a Bitcoin-only custodian, which would provide support to those who are pioneering the adoption of Bitcoin. He stated that the two teams had been working together for almost a year on more robust custody models, and saw the potential to take advantage of the unique capabilities of each company.

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