The CEO of Nasdaq (NDAQ), Adena Friedman, announced the decision during an earnings call on Wednesday. The company had planned to launch a cryptocurrency custody service in the second quarter of this year. However, it was learned that this plan had been suspended.
Breaking News: Nasdaq Crypto Custody Service has been Suspended as a Result of US Regulatory Conditions / 07.19.23
The operator of the Nasdaq stock exchange had stated in September 2022 that it was putting up the infrastructure and obtaining the necessary regulatory license for a crypto custody plan. For a limited-purpose trust company that would manage the custody business, the company had submitted an application to the New York Department of Financial Services (NYDFS). However, given the changing commercial and legal environment in the US, Nasdaq has now decided to abandon these ambitions and its pursuit of the required license, according to Friedman.
Considering the shifting business and regulatory environment in the U.S., we’ve made the decision to halt our launch of the U.S. digital assets custodian business and our related efforts to pursue a relevant license. However, we continue to build and deliver technology capabilities that position Nasdaq as a leading digital asset software solutions provider to the broader global industry.
Friedman
Nevertheless, the company would seek to continue assisting the digital asset sector in several ways, she said, including collaborations with future ETF issuers and the provision of technology for crypto custody. In the United States, where regulators seem to be pursuing crypto businesses and related services, Nasdaq’s decision is a blow to the institutional adoption of cryptocurrency. This raises concerns that these firms will leave for more welcoming nations.
More broadly, we remain committed to supporting the evolution of the digital asset ecosystem in a variety of ways, among them through our ongoing engagement with regulators, the delivery of comprehensive technology solutions across the trade life cycle, and through our partnerships with potential ETF issuers to support tradable exchange-listed products,
Friedman
Conclusion
In summary, Nasdaq suspended its crypto custody plans citing the US regulatory environment. Of course, to a shifting regulatory environment had an enormous impact on this decision.
Leave a comment