Digital Asset Custody is Biggest Hurdle in Institutional Involvement
By Dominik Poiger, Portfolio Manager at VanEck
Traditional assets like equities and bonds are custodied by large organizations such as Bank of New York Mellon or State Street.A major hurdle for institutional investors to enter the digital asset space has been the lack of such a custodian (“qualified custodian”).
Digital asset safekeeping revolves around providing cold storage of private keys with so-called “air-gapped” devices, hardware that is never connected to the internet to prevent hacks, theft or collusion. As of today, the traditional custodians have averted moving into this space and institutional investors have to turn to the likes of BitGo, Ledger, Trezor or Coinbase Custody.
About the Author:
Dominik Poiger oversees ETF Portfolio Management for VanEck Europe. Prior to joining VanEck he held a Portfolio Manager position at Tungsten Capital Management GmbH being responsible for managing two UCITS funds and consultant in the Financial Services Transaction Department at PwC. He holds a Diploma in Business and Economics with specialization in Accounting and Finance, International Economics and Banking and Finance from University of Hohenheim, Germany.
The article above is an opinion of the author and does not necessarily reflect the opinion of MV Index Solutions or its affiliates.