Nasdaq, an exchange operator in the business for 52 years, has recently been considering moving into the cryptocurrency market. The company is currently striving to provide cryptocurrency trading and custodian services to its customers.
To begin providing cryptocurrency custodial services to its customers, Nasdaq is currently waiting for approval from the NYDFS by the end of June 2023.
During the course of the past year, Nasdaq clarified that it intends to enter the cryptocurrency industry following the failure of Three Arrows Capital in July 2022. Even after several major companies in the cryptocurrency space went bankrupt, it has persisted in moving forward with its crypto ambitions.
Notwithstanding this, Nasdaq has been patiently waiting for some legal clarity to emerge in the United States cryptocurrency industry.
Matt Savarese, head of the strategy for digital assets at Nasdaq, was recently interviewed (1) for a podcast, and he made the following statement:
“Trust had begun to erode to some degree, and they desperately wanted that trusted player to step up and take their place. We are heading in the correct direction.
Having that fundamental aspect of custody was absolutely vital, and we see institutions, and they’re not even backing away from the space, but they are particularly looking for actors like us to say, great, they manage to deliver it.
They’ve been doing it for half a century now. They are also innovative within the context of the regulatory environment.
Dealing with Authorities in the United States
Following the failure of the cryptocurrency exchange FTX a few months ago, authorities in the United States have been increasing their scrutiny of companies involved in the cryptocurrency industry.
They have also requested that banks limit any further collaboration with cryptocurrency companies.
As a result, obtaining authorization to conduct business in the cryptocurrency industry from governing bodies in the United States is becoming an increasingly challenging endeavor. In addition, the NYDFS has recently increased its scrutiny of cryptocurrency businesses.
The New York Department of Financial Services (NYDFS) requested that the blockchain infrastructure company Paxos Standard cease issuing the Binance USD (BUSD) stablecoin late in the month of February.
However, American officials have not been shy about going after large cryptocurrency enterprises. The SEC informed the cryptocurrency exchange Coinbase last week that it will soon conduct investigations into a number of the company’s offerings by sending them a Wells Notice.
Nevertheless, in spite of the gloomy picture that has been painted, Nasdaq has decided to remain optimistic. In addition to its cryptocurrency custody services, Nasdaq intends to also provide liquidity services in the near future.
“Execution and liquidity services are the next steps for us. And then we expand on our anti-financial crimes so that we can supervise this throughout the entire ecosystem, Savarese said. “We are optimistic.”