Four months after announcing it would acquire the asset custodian Kingdom Trust, blockchain security firm BitGo has decided instead it would just build its own.
The startup said Thursday that it was "seeking a charter to build BitGo Trust," a "new, regulated, qualified custodian" that will be built specifically for digital assets, according to a Medium post. At the same time, it announced it would no longer proceed with acquiring Kingdom Trust, after approval of the acquisition spent four months in regulatory limbo.
This limbo, however, is not what inspired BitGo to build its own trust, marketing vice president Clarissa Horowitz told CoinDesk. Rather, the startup came to the decision after looking at its clients' needs, she said, adding:
While BitGo does not yet know what sort of timeline it is looking at, Horowitz did say that the company is "working very closely with regulators." In the meantime, it already offers customers two options for asset management. The first option revolves around BitGo's recently-announced suite of custodial services, where the company now offers several degrees of custodial services.
Alternatively, clients can manage their own assets, she said.
On the importance of building a digital asset custodian specifically aimed at the cryptocurrency space, Horowitz said "I think it's critical, I think the way that you hold digital assets [is different from how you're] holding stock certificates."
She referred to comments made by BitGo chief executive Mike Belshe, who said in a previous post that "custodians make institutional investing possible by providing a level of checks and balances to keep money safe."
Bank vault door image via Shutterstock
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2023, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.