Sumitomo Mitsui partners with crypto exchange Bitbank to offer custodial services to institutional clients
The crypto services will be offered through the establishment of Japan Digital Asset Trust (JADAT), a trust company designed to facilitate the entry of institutional players into the country’s digital assets market.
Sat, 28 May 2022, 10:55 am UTC
Sumitomo Mitsui Trust Holdings Inc is joining the growing list of global financial giants getting into crypto. The financial services firm has teamed up with a Japanese crypto exchange to create a company that will manage digital assets for its institutional clientele.
Sumitomo Mitsui just signed a memorandum of understanding with Bitbank, a Japanese crypto exchange operator, that will allow it to offer custody services, according to Bloomberg. The planned services will support public blockchain-based crypto assets such as Bitcoin (BTC), Ethereum (ETH), and non-fungible tokens (NFTs).
The crypto services will be offered through the establishment of Japan Digital Asset Trust (JADAT), a trust company designed to facilitate the entry of institutional players into the country’s digital assets market, according to Cointelegraph. Aside from offering custodial services, JADAT will also offer auditing and wallet insurance.
Unlike the institutional-driven US crypto market growth, Japan’s digital assets market is predominantly retail. The availability of trusted custodial services could drive institutional adoption of Bitcoin, Ether, and other crypto assets in the country.
“The biggest problem is that there is not a trustworthy digital custody service,” Bitbank Chief Executive Officer Noriyuki Hirosue said. “Given the past incidents, crypto companies do not enjoy public trust. We need cooperation of a major trust bank.”
Bitbank is one of Asia’s largest crypto exchanges. The platform has a monthly trading volume of over $5 billion.
Meanwhile, Sumitomo Mitsui Trust Holdings is a publicly-traded holding and specialized trust bank group. With its announcement, the company became the second major financial institution in Japan after Nomura Holdings Inc to enter the crypto custody services niche.
Nomura recently announced that it plans to offer Bitcoin (BTC) derivatives to its clients in Asia. Just last week, it revealed that it will form a crypto subsidiary that will be based outside Japan to focus on clients who want to invest in cryptos and NFTs.
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