Coinbase Gets Approval to Offer Crypto Custody Services in the State of New York

New York state regulators have approved Coinbase Custody Trust Company LLC to roll out their cryptocurrency custody services in the state, according to an official announcement published Oct. 23. The New York State Department of Financial Services (DFS) has authorized Coinbase’s wholly-owned subsidiary Coinbase Custody Trust Company LLC to provide a limited range of custody services for virtual currencies, including Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH), Ethereum Classic (ETC), Ripple (XRP) and Litecoin (LTC). Commenting on the approval, Asiff Hirji, President and COO of Coinbase, stated that “since 2014, the New York Department of Financial Services has proven itself to be a strong advocate in its support for the responsible growth of the cryptocurrency industry.” Hirji further added: “The New York State Limited Purpose Trust charter, which now enables Coinbase Custody to act as a Qualified Custodian for crypto assets, builds on our unparalleled success as a crypto custodian while holding the company to the same exacting fiduciary standards and oversight of other, mature financial institutions operating in New York.” Coinbase launched its custody services ‘Coinbase Custody’ in July, focusing on institutional customers and optimized to store large amounts of digital currency. The product purportedly utilizes a range of security measures, including “on-chain segregation of crypto assets,” “offline, multi-sig and geographically distributed transaction protection” and “robust cold storage auditing and reporting.” Coinbase Custody also uses systems from SEC-registered broker-dealer and FINRA-member Electronic Transaction Clearing (ETC). In August, Coinbase announced plans to add 40 new assets to its custodian service. The crypto assets in question, however, may be added “for storage only,” as Coinbase is not currently considering the assets for trading.