Coinbase Custody Trust Company LLC, received approval as “a limited purpose trust company”, from the New York State Department of Financial Services (NYDFS) on October 23, 2018.
Coinbase Custody, which was launched back in July of this year, can provide custody services for Bitcoin (BTC), and the various altcoins Ethereum (ETH), Litecoin (LTC), XRP (XRP), Ethereum Classic (ETC), and Bitcoin Cash (BCH). The company is a subsidiary of Coinbase. This approval of custodianship will allow the company hold money on behalf of users with the purpose to reduce thefts and loss of funds for cryptocurrencies. This was an effort to draw in institutional investors with the promise of a more secure environment in the new industry.
Coinbase has previously stated:
“Coinbase Custody is a combination of Coinbase’s battle-tested cold storage for crypto assets, an institutional-grade broker-dealer and its reporting services, and a comprehensive client coverage program.”
Coinbase president and COO Asiff Hirji, spoke on the approval by the NYDFS, claiming that the regulators have been “strong advocates” for introducing a secure crypto market. He goes on to praise Superintendent Vullo, for her foresight for the industry.
Hirji has stated:
“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. 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. We applaud the leadership Superintendent Vullo has shown to guide the responsible growth of the cryptocurrency ecosystem and look forward to working with their offices in the future,” the president said.
Financial Services Superintendent Maria T. Vullo commented as well on the approval of Coinbase Custody:
“New York continues to be a leader in creating, fostering, and responsibly regulating a financial services marketplace that promotes innovation, safeguards the industry and protects consumers through strong supervision. Today’s approval further demonstrates that the state regulatory system is the best arena in which to responsibly supervise the growing fintech industry within a sound and compliant framework.”