Bitgo, a cryptocurrency security and custody company, has been granted regulatory approval to provide its storage services to the United States. Specifically, Bitgo will target U.S.-based institutional investors with its “Bitgo Trust Company.”
Bitgo Approved by South Dakota Regulators
The South Dakota Division of Banking has approved Bitgo Trust Company as a public South Dakota Trust Company – allowing the company to offer its cryptocurrency custody services to institutional investors in the United States.
Mike Belshe, the chief executive officer of Bitgo, stated: “Custody has been the missing piece of cryptocurrency market infrastructure and this gap has kept institutional investors out of the market. Traditional custodians don’t have experience handling cryptocurrency. Exchanges that double as custodians present a conflict of interest and raise regulatory concerns. Bitgo Trust Company is a qualified custodian, and therefore the only custody offering that delivers the highest levels of both security and regulatory compliance.”
Shahla Ali, Bitgo’s chief compliance and legal officer, told media: ”Currently […] we offer an online hot wallet solution, which is available to anyone to download our software and store their coins. We also offer a custodial solution which is a combination of hot and cold wallet […] that offering, though secure, is not regulated like the Trust.”
Bitgo Trust Company to Target Institutional Investors
Mrs. Ali continued: “The Trust company will enable us to offer a qualified custodial offering that is regulated, that has the money laundering and know your customer requirements.” Mrs. Ali added that Bitgo’s “custodian offering already has money laundering and KYC requirements,” however, and emphasized that the Trust is suited “for institutional clients […] especially for those who are registered advisers and broker-dealers.”
Whilst the Bitgo Trust Company has been specifically approved by South Dakota’s regulators, Mrs. Ali stated that “generally other states will give you reciprocity in the sense that other states have money transmission laws and they’ll exempt you from money transmission requirements.”
Bitgo’s website states that its custody services offer “100% cold storage technology in bank-grade Class III vaults,” “Support for 75+ coins and tokens,” and “Multi-user accounts.”
Do you think that more company’s will seek approval in South Dakota to offer crypto custody services to U.S. investors? Share your thoughts in the comments section below!
Images courtesy of Shutterstock
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