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12 months on: 3 lessons learnt post-FTX  

November 11th marked the first-year anniversary of the collapse of FTX, serving as a crucial source of lessons and warnings for all players in the digital asset ecosystem. Acting as a catalyst, the collapse has sparked necessary dialogues geared towards providing clarity to all industry participants, ranging from regulators to institutions. 

In this article, we explore three lessons learned from the fall of what was once the world’s second-largest cryptocurrency exchange. 

Lesson one:  prioritise robust risk management 

The mismanagement of critical risk factors, including counterparty risk, inadequate liquidity, and operational oversights, played a pivotal role in the downfall of FTX. This collapse serves as a stark reminder for crypto asset service providers (CASPs) to bolster their risk management practices and implement robust internal controls when navigating the intricate landscape of digital assets. 

In the aftermath of the collapse, a notable shift occurred—institutional firms and CASPs themselves began taking a more proactive stance to identify and assess the risks that CASPs they deal with, either as counterparties or clients, may pose, and evaluate the adequacy of controls that are in place. This has enabled better-informed decisions to be made with respect to risk management and has, over the past year, resulted in standards across the industry increasing. Additionally, CASPs and institutional firms need to ensure that training and risk awareness throughout their organisations are significantly improved and that a culture of risk awareness and compliance is embedded. 

Embedding these cultures extends beyond merely implementing risk and compliance measures. As an industry, cultivating a mindset that truly values and proactively manages risks at every level is essential for attaining lasting success. 

This increased scrutiny reflects a growing awareness within the institutional landscape regarding the importance of comprehensive risk management strategies, which remain a challenge in the lack of clear consensus and crypto specific regulation. 

Lesson two:  embrace transparency and reporting  

Transparency and accountability form the bedrock of a thriving digital asset ecosystem. The FTX collapse reinforces the indispensable roles played by both internal and external audit functions. 

 For CASPs, transparency is not just an organisational value but a necessity for building trust with clients. The situation with FTX, where audited financial statements remained undisclosed until after the collapse, is an obstacle for clients seeking to comprehensively assess the financial health and operational integrity of a service provider. 

In response, institutions are increasingly choosing to collaborate with service providers that can provide evidence of reporting through SOC 1 and SOC 2 reports. The former focuses on internal controls over financial reporting, while the latter examines organisational controls pertinent to both operations and compliance. This transformative shift highlights an increasing emphasis on accountability and transparency within the digital asset space, marking a game-changing moment for those seeking to establish credibility and build trust. 

 However, the mantle of responsibility for transparency extends beyond service providers alone. Institutions, as architects of their partnerships, bear the responsibility to conduct thorough due diligence when selecting a partner. Asking rigorous questions and carefully researching a service provider’s history, shareholders, and risk management practices are non-negotiable prerequisites before making any commitments. 

The responsibility for transparency and accountability within the industry also extends beyond service providers and institutions; regulators play a crucial role. They bear the responsibility of proactively formulating clear and comprehensive regulations, enforcing them diligently, and taking decisive action against any misconduct. Well-defined regulations in the digital asset space act as necessary regulatory guardrails, contributing to clarity within the industry and fostering a conducive environment for the growth and maturation of the digital asset sector. 

Lesson three:  asset segregation is paramount   

In the aftermath of FTX’s collapse, a crucial lesson emerges — the importance of asset segregation and the protection of clients’ funds. The fallout, marked by the disappearance of significant client assets, serves as a stark reminder to the industry about the importance of maintaining a clear distinction in clients’ holdings. 

Asset segregation involves a clear separation of clients’ assets, preventing any co-mingling, whether among institutional clients or between an institution and the service provider. Let’s explore two scenarios of asset co-mingling and their potential outcomes. In the case of an omni-bus wallet where clients’ assets are mixed and the crypto service provider goes under, determining ownership becomes challenging. Despite the potential for retrieval, the looming risk of prolonged asset entanglement within a complex administrative process is evident. 

In another scenario, if there’s a failure to maintain clear segregation between clients’ assets and those of the provider, there’s a potential for these assets to come under the administration of the service provider should they go bankrupt. This outcome is contingent upon the legal structure in place and without the safeguard of insolvency protection. 

The collapse not only highlights the importance of a clear legal framework but also underscores the critical role of the implementation of a well-defined recovery and resolution strategy. Such a strategy is essential for ensuring that clients maintain both legal and operational control over their private keys and underlying assets. These measures serve as integral components in fortifying the resilience of market infrastructure and fostering confidence in the ongoing development of the digital asset ecosystem. 

Conclusion 

These lessons highlight the foundational principles that shape a resilient and trustworthy digital asset ecosystem. By implementing robust risk management practices, industry participants can navigate the complexities of the ever-evolving landscape with greater confidence and stability. Embracing transparency and reporting not only fosters trust but also cultivates an informed and collaborative industry. 

These fundamentals collectively set the stage for the sustained growth and maturation of the sector. Prioritising risk management, transparency, and asset segregation establishes a strong foundation capable of overcoming challenges and instilling confidence within the sector. 

Zodia Custody to enter Hong Kong market

The latest geographical expansion for the bank-backed digital asset custodian demonstrates further commitment to evolving the ecosystem across the Asia-Pacific region

The move will allow the firm to develop further optionality for institutions, corporations and professional investors in Hong Kong’s rapidly diversifying digital asset market. The Hong Kong entry represents the fourth major geographical expansion in the region this year for the custodian, following launches in Japan, Singapore and Australia. It also marks yet another pivotal step in cementing Zodia Custody as an established player in the Asia-Pacific digital asset ecosystem.

“Moving into the Hong Kong market has always been a fundamental part of our strategy,” said Julian Sawyer, CEO, Zodia Custody. “We are committed to not just being an active participant in the digital asset ecosystem across Asia-Pacific, but to help evolve it. We can’t do this if we are not firmly established in Hong Kong, a major global digital asset hub. Through our bank-backed heritage, we have a unique understanding of the needs of institutional investors, and how to engage with the wider ecosystem to develop greater options and opportunities that work with, not against, compliance and governance. We are here to accelerate digital asset adoption.”

Hong Kong is working to establish itself as a key player in the digital asset sector, including introducing a new virtual asset regulatory regime earlier this year. Moves such as these by local authorities and the HKSAR Government have created an environment for sharp growth in digital asset adoption, with the market expected to have an annual growth rate of more than 14% and a value of US$243.9m by 2027.

Through Zodia Custody’s presence in Hong Kong, institutional investors will be able to accelerate their digital asset adoption via effective safeguarding and risk management services enabled by cutting-edge technology, bank-level compliance and governance. This includes the custodian’s market-leading Interchange offering, which provides institutions with additional layers of risk management, secure custody and insolvency protection, developed as a result of recent market turbulence.

Zodia Custody will also look to develop local partnerships to create more innovative, bespoke solutions for the Hong Kong and wider Asia-Pacific market. Past successes include the capability to offer institutional staking with Blockdaemon. More recently, Zodia Custody worked with National Australia Bank to develop SAF3 — a simple, safe, and secure real-time digital asset custody platform designed specifically for Australian portfolio managers and institutions.

Zodia Custody launches SAF3 in Australia!

SAF3 is the simplest, safest, and most secure real-time digital asset custody platform in Australia, designed for institutions.

SAF3 has been built by institutions for institutions, and will be launched in Australia by a new subsidiary called Zodia Custody Australia on Monday, 16 October, 2023. Using Zodia Custody’s tried and tested regulation-ready technology, SAF3 will enable institutions in Australia and New Zealand to:

●  Protect funds – with bank-grade cold wallet storage which is uniquely accessible in real-time

●  Grow assets – through one single portal to connect to exchanges and participate in network activities

●  Safeguard businesses and their customers – with risk, controls and enhanced fraud and scam detection capability.

“Our expansion into Australia is integral to our core mission — to provide safe, secure access for institutions to not only safely access the opportunities digital assets bring, but to increase their exposure, safely,” said Julian Sawyer, CEO, Zodia Custody. “Today, an estimated 26% of Australians hold digital assets, totalling the equivalent of $21.6 billion currently held via cryptocurrency exchanges and custodial solutions. Responsible institutional adoption is key to ensuring this growing industry is safe and secure for all. Institutions need bank-grade infrastructure to responsibly participate. Our technology and risk management infrastructure housed within the SAF3 platform was built from the ground-up for institutions by institutions, such as regulated banks.”

Zodia Custody Australia will target corporate and institutional customers to offer digital asset custody services including connectivity to exchanges via the SAF3 platform. The custodian will roll out SAF3 as well as an enhanced suite of services in 2024, to allow institutions to manage their digital assets activities all in one safe, secure platform.

NAB, Australia’s largest business bank, has collaborated with Zodia Custody via a proof of concept designed to test the bank-grade credentials of the SAF3 platform.

“As a trusted financial institution, we have an important role to play in advancing the maturity of blockchain enabled sector to provide the simplest, safest and most secure services for Australians, including in emerging areas where technology should be rigorously tested,” said Howard Silby NAB’s Chief Innovation Officer.

“That’s why we’ve collaborated with Zodia. Over a nine-week period, we tested Zodia’s integration and compliance capabilities, technology, and governance processes. This included testing Zodia’s unique approach to a real-time air-gapped cold wallet capability and the new all-in-one digital assets platform experience; SAF3. The results were overwhelmingly positive,” said Mr Silby.

Both Zodia Custody Australia and the SAF3 service will launch with Australian blockchain technology company, DigitalX, as the first customer.

“As the first publicly listed blockchain technology company, we are always focused on innovating and evolving the ecosystem, to ensure that we can offer our customers the safest and most secure multi-wallet experience. Through Zodia Custody, SAF3 will help us to further achieve that, ensuring bank-level safety and security for our customers which is important given our BTC Fund is Number 1 rated with SQM over 3 and 5 years,” said Lisa Wade, CEO of DigitalX.

“I’m excited that the SAF3 platform will provide connectivity to exchanges safely and securely and reduce execution risk for our fund and balance sheet trading,” said Ms Wade.

Zodia Custody is registered with regulatory bodies globally including the Financial Conduct Authority (FCA), Central Bank of Ireland (CBI) and Commission de Surveillance du Secteur Financier (CSSF) across the UK, Ireland & Luxembourg. It is the first bank-backed digital asset custodian to receive registration with the UK’s regulator. Proactive and collaborative engagement with the Australian regulators is intended with the creation of the Zodia Custody Australia subsidiary. The launch in Australia also follows the custodian’s recent entry into the Singapore market in September.


Notes to Editors:

High-resolution images and logos can be found here.

For more information about Zodia Custody: LinkedIn, Twitter.

SAF3 capabilities

●  SAF3 uses air-gapped, cold wallet storage built to government standards to ensure customer assets are kept offline until you need to access them. SAF3’s unique, bank-grade technology allows access to assets in cold storage in real-time.

●  Designed to help clients connect to exchanges whilst mitigating counterparty risk when trading digital assets through one single portal, SAF3 also provides the added security of post-trade settlement, meaning that assets are protected from exposure or third-party risk while in transit.

●  Every action and transaction is securely monitored with custom business considerations, local and global regulations and risk controls. Customised, multiparty transaction approvals, fraud detection checks, security screening and alerts all ensure businesses are safeguarded against risk.

●  SAF3 is inbuilt with a walled garden, which includes fraud and compliance intelligence tools that analyse participants and wallet addresses that need to be “SAF3listed” in order to interact with clients. Before crypto assets can be sent into or outside the SAF3 walled garden, a series of checks will take place to ensure proposed transactions comply with a new, configurable set of policies co-designed with our banking partners to prevent proceeds of fraud and scams from Australia entering the global network. Activity falling outside of business-defined, configurable risk processes or platform compliance checks will be quarantined while enhanced checks are made and if necessary blocked within the SAF3 platform.

●  Zodia Custody will grow partnerships in Australia to produce a suite of integrated services, enabling clients to safely access vetted services, all within the SAF3 portal.

Get a sneak peak of the SAF3 Platform here


Media contact

Rich Went

Gallium Ventures

+44 (0) 7745 496 065

[email protected]

Zodia Custody and Bitfinex collaborate to transform exchange custody models 

Through Interchange, Zodia Custody and Bitfinex offer a truly bank-grade approach to off-exchange settlement to better protect institutional investors 

The move is part of a wider commitment from both firms to evolve the digital asset ecosystem infrastructure, with a focus on greater security and compliance. 

Zodia Custody’s market-leading product, Interchange, provides independent and effective safeguarding of digital assets for institutional clients trading on Bitfinex, while also reducing counterparty risk exposure. 

The Interchange offering from Zodia Custody and Bitfinex has been designed with ease of use in mind, achieved through fully end-to-end processes and API integration. The solution provides a very low-touch operational process, automating the entire set of activities associated with digital asset custody — from asset mirroring on trading venues to settlement posting and execution. This process has been designed on a rule-based system that is completely standardised to ensure settlement is time-bound while keeping operational risk to a minimum for all participants. This is achieved by placing particular emphasis on limiting the number of on-chain settlement movements, creating significant cost savings for participants. 

The collaboration between Bitfinex comes in response to increased institutional demand for a greater separation of exchange execution from custody, clearing, and settlement functions. As investors look to reduce risk while also requiring more robust security for their assets, the partnership is well-positioned to serve those needs.

“We believe in fostering a collaborative environment to drive innovation and best practice in the digital asset sector,” said Paolo Ardoino, CTO of Bitfinex. “We are committed to shaping the future of digital market infrastructure and enabling institutional investors to thrive in this space. Working with Zodia Custody is a significant part of that strategy, and together we can look to enable even more institutions to enter or further participate in digital assets.” 

Zodia Custody will leverage its heritage in being backed by three global banks for the partnership — providing the collaboration with a truly rigorous, ‘bank-grade’ approach to custody.
“Interchange has been designed from the ground up to provide a better, more robust, approach to custody when trading through exchanges — this is custody, without compromise,” said Julian Sawyer, CEO of Zodia Custody. “For investors in the digital asset space today, this isn’t a ‘nice to have’ but an absolute requirement. This collaboration not only underscores our commitment to delivering secure and compliant solutions, but also highlights the maturation of the digital market infrastructure.”

Zodia Custody appoints James Harris as Chief Commercial Officer

Harris joins the business from CCData, where he was the Commercial Director for the digital asset data company. 

Harris’ appointment comes as Zodia Custody targets continued global growth, as highlighted by the firm’s most recent launch in Singapore. Harris will be responsible for driving commercial opportunities across the global business, and will be based at the firm’s headquarters in London. Harris will report to Zodia Custody CEO, Julian Sawyer.

“The digital asset world is the most innovative and exciting space in financial services. It’s not often that we get to build a financial system from the ground up—yet our work with institutions is doing exactly that,” said James Harris, Chief Commercial Officer at Zodia Custody. “We are creating an entirely new ecosystem for institutions to really seize the advantages digital assets offer, and I look forward to working with Julian and the team to not just bring our products to institutions across the world, but to build the infrastructure of the future.”

Prior to his previous role at CCData, Harris was Head of Sales at MetaVault and Head of Custody at Diginex. He also co-founded Altairian, and had previously worked as a Director at Standard Chartered. 

“James is exactly the right fit for our business. He doesn’t just know our world in detail, he firmly believes in our mission and vision,” said Julian Sawyer, CEO, Zodia Custody. “James also embarks on this journey at an incredibly interesting time, as we leverage the work and partnerships we have achieved this year to develop our solutions across the world.” 

Zodia Custody named as the first technical host of the Stellar Disbursement Platform

The work will see Zodia Custody enable access to the Stellar Disbursement Platform,  creating capabilities to allow organisations to securely send bulk payments for various use cases, including for humanitarian aid, cash assistance programs, cross border payroll, and more.

The  collaboration will provide greater cost effectiveness when compared to traditional fiat rails, and ensure greater speed and security for payments, reinforced  via Zodia’s  bank-level infrastructure. This means that charitable organisations can accept digital asset donations on a larger scale, and then seamlessly disburse the value to many recipients around the world.

“Digital assets, blockchain and other web3 technologies have great power to transform the world as we know it. Being from Zimbabwe, I’ve seen first hand how digital assets can be used as a force for immense social good, as well,” said Anoosh Arevshatian, Chief Risk Officer at Zodia Custody.

“Our collaboration with the Stellar Disbursement Platform is a fantastic example of how blockchain technology can be leveraged to create a fairer financial system for many today. This is vital work: creating a more accessible system so anyone—regardless of where they were born or where they live—can participate in a global, more equitable financial network.”

Media contact

Rich Went 

[email protected]

+44 (0) 7745496065

Zodia Custody announces partnership with KYAX 

Zodia Custody and KYAX are both committed to building critical parts of the Web3 infrastructure. The partnership between these two firms seeks to deepen institutional adoption of digital assets by providing custody with audit, business, and regulatory reporting. 

Together, we look forward to providing an unmatched level of confidence and value to the digital assets’ ecosystem. 

Forging Trusted Partnerships  

Zodia Custody is looking forward to building strong partnership with KYAX, a leading provider in b2b crypto asset reporting. From secure custody solutions to sophisticated reporting tools, clients can expect a seamless experience that simplifies compliance, enhances transparency, and unlocks the true potential of their digital asset management.

“The word Custody in Digital Assets means many things to many people, it’s great to have a reliable partner like Zodia Custody, focused on ensuring Digital Assets are bankruptcy remote, legally protected and reported on accurately”, explained Matthew de la Fuente, CEO at KYAX. 

“Without the right reporting and data collection methodologies, we are hamstrung as an industry,” said Julian Sawyer, CEO of Zodia Custody. “There is no understating how foundational effective reporting is to building a transparent, secure, and robust infrastructure for digital assets. This is where our partnership with KYAX will make a big impact; another step on the road to better allow institutions to enter the market safely and at scale.”

KYAX

KYAX is a B2B plug-in tool that provides Crypto Asset Reporting. Founded upon decades of Trad-Fi, Regulatory and Crypto experience, KYAX helps system and data constrained Crypto leaders get the right data, into the right hands, with the right reports. 

By consolidating Google Sheets, Excels, Blockchains and other systems, KYAX provides repeatable clean data and reports for Finance teams, Auditors, Clients, Investors and Regulatory Bodies.  

Zodia Custody 

Zodia Custody is the leading institution-first digital asset custodian by Standard Chartered, in association with Northern Trust and SBI Holdings. It enables institutional investors around the globe to realise the full potential of the digital asset future – simply, safely, and without compromise. Through the combination of leading technology, custody, governance and compliance, Zodia Custody satisfies the complex needs of institutional investors.

Zodia implements the requirements of the 5AMLD and applies the same standards as Standard Chartered relating to AML, FCC, and KYC. It implements the requirements of the FATF Travel Rule. Zodia Custody Limited is registered in the UK with the FCA as a digital asset business under the Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017. Zodia Custody (Ireland) Limited is registered with the Central Bank of Ireland as a VASP under Criminal Justice (Money Laundering and Terrorist Financing) Act 2010 (as amended). Zodia Custody (Ireland) Limited was established in Ireland in August 2021. Zodia Custody Limited is registered with the CSSF in Luxembourg as a Virtual Asset Service Provider in accordance with article 7-1 (2) of the law dated 12 November 2004 on the fight against money laundering and terrorist financing, as amended.

Zodia Custody partners with OpenEden to provide yield opportunities for institutions  

Zodia Custody partners with OpenEden to provide yield opportunities for institutions  

  • Institutional investors will now be able to access “Zodia Custody Yield”, allowing access to earnings potential via Open Eden’s service whilst assets are held safely in bank-grade digital asset custody 

As part of “Zodia Custody Yield”, which includes staking, this partnership represents an opportunity for institutions to access off-chain yield potential for their on-chain assets – without compromising on the bank-grade security of Zodia Custody’s platform. 

This partnership responds to investor need for an institutional-grade custody solution for digital asset products that are low-risk, liquid, and transparent with respect to how returns are generated for stablecoin holders. 

Zodia Custody, as a bank-owned entity with a strong culture of institutional regulatory compliance and governance, will now be able to provide added assurance to investors seeking to custody assets in safe cold storage. At the same time, institutions will benefit from having access to the potential of real-world yield from US Treasury bills enabled by OpenEden’s platform, which provides on-chain security and transparency on real world assets managed by regulated fund managers.  

“There’s a lot in the world of traditional finance that can be moved to digital assets.” said Julian Sawyer, CEO of Zodia Custody. “The challenge is how to bring some of the benefits to the world in a safe, compliant and regulatory-first way. Our first such partnership with OpenEden is exactly how we do this — by bringing access to yield products to our clients.”

“There are billions of dollars worth of stablecoins sitting on the sidelines when they could easily be generating yields for investors.” said Jeremy Ng, co-founder of OpenEden. “That’s a huge opportunity and one that we and Zodia Custody hope to bring to institutions through our respective service platforms which will allow issuers and investors to enter the digital asset market through tokenised financial products, in a way that is both safe and transparent.”

The partnership with OpenEden, a leading Singapore based  digital asset platform developer, comes just days after Zodia Custody announced its subsidiary in Singapore, following strong client demand and accelerated global growth.

ENDS

About OpenEden 

OpenEden Labs Pte. Ltd. is a blockchain technology provider building the bridge to a new financial system. Our mission is to bring real-world assets on-chain to unlock trillions of dollars in value. We believe that internet-native money and decentralization will open up access to real-world assets for everyone on a global scale, creating a more inclusive, efficient and free-flowing economy.

About Zodia Custody

Zodia Custody is the leading institution-first digital asset custodian by Standard Chartered, in association with Northern Trust and SBI Holdings. It enables institutional investors around the globe to realise the full potential of the digital asset future – simply, safely, and without compromise. Through the combination of leading technology, custody, governance and compliance, Zodia Custody satisfies the complex needs of institutional investors.Zodia Custody implements the requirements of the 5AMLD and applies the same standards as Standard Chartered relating to AML, FCC, and KYC. It implements the requirements of the FATF Travel Rule. Zodia Custody Limited is registered in the UK with the FCA as a crypto asset business under the Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017. Zodia Custody (Ireland) Limited is registered with the Central Bank of Ireland as a VASP under Criminal Justice (Money Laundering and Terrorist Financing) Act 2010 (as amended). Zodia Custody (Ireland) Limited was established in Ireland in August 2021. Zodia Custody Limited is registered with the CSSF in Luxembourg as a Virtual Asset Service Provider in accordance with article 7-1 (2) of the law dated 12 November 2004 on the fight against money laundering and terrorist financing, as amended

Zodia Custody integrates into newly-launched Stablecoin Studio on Hedera

Zodia Custody will now enable institutions to seamlessly create, issue and manage their own stablecoins via the newly-launched Stablecoin Studio on Hedera – whilst storing them securely with Zodia Custody.

Institutions, Web3 stablecoin platforms, and payment providers will now be able to create their own stablecoins within a number of hours, rather than the weeks or months currently required. Institutions will benefit from compliance and security throughout the process, starting with configuration, issuance, and management all the way to the custody of their own stablecoins. Issuers are also able to integrate leading KYC/AML services, alongside having automated compliance flags for their accounts as an added layer of security. 

The integration alleviates complexities, accelerates development, and streamlines operations for institutions when building stablecoins in-house, through an all-in-one solution, without compromising on the robust security measures market participants require in the digital asset space. The integration opens up access to digital assets for institutions without the need for specialised blockchain expertise. 

“Integrating with Stablecoin Studio on Hedera is a natural next step to build the market infrastructure institutions need to enter digital assets at scale, and without compromise on security” said Thierry Janaudy, CTO of R&D at Zodia Custody. “Token issuance, naturally, is a big part of this. Together, we’re providing institutions with the tools to get the most out of innovative blockchain technology, be it for tokenising real-world assets, or using stablecoins for payment solutions.”

The focus of the ecosystem in building Stablecoin Studio has been to make creating stablecoins accessible, safe, and simple for institutions and enterprises alike,” said Dr. Sabrina Tachdjian, Head of the Fintech & Payments Fund at the HBAR Foundation. “Thanks to our strategic partnerships with Zodia Custody, who share our vision for an institutional-grade service, we are able to bring that reality within reach. Digital assets need no longer be a distant ambition, but a seamlessly integrated, daily part of financial institutions operations

ENDS

Notes to Editors:

High-resolution images and logos can be found here.

For more information about Zodia Custody: LinkedIn, Twitter.

Zodia Custody media contact

Rich Went 

Gallium Ventures

+44 (0) 7745 496 065[email protected]

Zodia Custody to Provide Institutional Support and Custody Services for the Polkadot Ecosystem

  • Parity and Zodia Custody to facilitate seamless institutional access to the Polkadot ecosystem, offering compliant custody and secure staking
  • Zodia Custody to aid in developing the Polkadot ecosystem’s institutional adoption via collaborative research and development initiatives 

Zodia Custody announces long-term strategic partnership with Parity Technologies, a leading contributor to Polkadot. The partnership will enable institutional access to the Polkadot ecosystem and in the longer term, broaden the Polkadot ecosystem’s institutional adoption via joint research and development initiatives. 

The partnership’s first major implementation will see Zodia Custody provide custody services for the Polkadot ecosystem, enabling secure market access and bank-grade digital asset custody services for financial institutions. With respect to its activities in crypto assets and as a VASP, Zodia Custody is registered with the UK’s FCA, Ireland’s CBI and Luxembourg’s CSSF per each jurisdiction’s money laundering requirements. As a result, institutions are able to operate with higher levels of regulatory compliance and within a framework of enhanced security on a registered platform. 

The next stage of the partnership will also enable financial institutions to stake DOT, the native token of Polkadot, whilst assets are held safely in cold storage within Zodia Custody, thereby broadening the reach of participation in the Polkadot ecosystem to institutions. The service has been designed to be as frictionless as possible and widen contribution to secure the decentralized Polkadot network.

“The gap between the world of digital assets and traditional finance is coming together, but strategic partnerships such as this one will help bridge that gap at scale,” said Julian Sawyer, CEO of Zodia Custody. “This partnership with Parity is essential to the future of this ecosystem by enabling future institutional participation. Together, we’re making Polkadot’s technology more accessible for institutions, while also bringing all the regulatory, governance, and security expertise we have as a bank-owned and registered entity.”

“This collaboration with Zodia Custody is a win-win,” said Björn Wagner, CEO of Parity Technologies. “It will allow financial institutions to actively participate in the Web3 future being built on Polkadot, and will also help the Polkadot ecosystem to engage directly with institutions. By tapping into Zodia Custody’s deep expertise as leaders in the digital asset custody space, this relationship will undoubtedly boost innovation, participation, and adoption across Polkadot.” 

Zodia Custody’s work with Parity will also see the digital asset custodian support the long term evolution and growth of the Polkadot ecosystem. This includes educating institutions about Polkadot technology via cross-collaboration research and development. Zodia Custody will also support various Parity and Polkadot global initiatives. 

ENDS

Notes to Editors:

High-resolution images and logos can be found here.

For more information about PolkadotLinkedInTwitter.

About Polkadot

Polkadot is the blockspace ecosystem for boundless innovation. It enables Web3’s biggest innovators to get their ideas to market fast, with flexible costs and token options. By making blockchain technology secure, composable, flexible, efficient, and cost-effective, Polkadot is powering the movement for a better web.

About Parity Technologies

Parity Technologies Ltd is a software development company and collective of tech experts who are passionate about building an internet that belongs to everyone. Comprised of some of the world’s leading blockchain innovators, core engineers, Rust developers, and solutions architects, Parity has offices in Berlin, London, Lisbon, and Singapore. Working with the Web3 Foundation, Parity successfully completed the launch of Polkadot in 2021 and continues to be a leading contributor to the network.

Media contacts

Zodia Custody: 

Rich Went 

Gallium Ventures

+44 (0) 7745 496 065

[email protected]

Parity Technologies:

Laura Cooley

Parity Technologies

+1 647 966 1446

[email protected]

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