BitGo Receives NYDFS Approval for New York Trust Charter

The firm plans to offer New York banks crypto custody as a service.

Mar 4, 2021 at 2:33 p.m. UTC
Updated Sep 14, 2021 at 12:21 p.m. UTC

Digital asset financial services firm BitGo is coming to New York.

After receiving approval from the New York Department of Financial Services (NYDFS) for a New York trust charter, BitGo plans to hold crypto funds in the state and offer custody as a service to large New York-based financial institutions, said Pete Najarian, chief revenue officer at BitGo. BitGo announced it had applied for the New York trust charter in August.

“We’re finding that the largest traditional financial institutions are all doing a considerable amount of work to determine what their level of participation will be in the digital asset space,” Najarian said. “For BitGo that can mean collaborative relationships in which we act as a sub-custodian or we work in partnership or we develop white label solutions.”

It's a situation not unlike the similarly chartered Paxos, which has been the backend provider for PayPal's crypto service since late last year. (BitGo reportedly rebuffed an offer of as much as $750 million to be acquired by PayPal, according to unnamed sources.)

Najarian also espoused a view in an interview with CoinDesk last year that banks should turn to crypto custodians to act as sub-custodians for digital assets instead of doing it themselves. 

Najarian did not comment on whether the New York trust charter was a step towards BitGo pursuing a national trust bank charter from the Office of the Comptroller of the Currency as Anchorage did last year.

“We are constantly evaluating the right long-term path here,” Najarian said. “I would expect that over time it will make sense for ourselves and firms like us to continue to evaluate what’s the most seamless path to get to a regulatory designation that allows you to custody assets with every state in the U.S. without ambiguity.”

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