BitGo wants to be ‘exchange agnostic’ as a qualified custodian

Copper and BitGo’s collaboration will allow institutions to keep their crypto in regulated cold storage while being able to still access certain exchanges

article-image

T. Schneider/Shutterstock modified by Blockworks

share

BitGo wants to reduce the “redundancy of exchanges.”

In partnership with Copper, international institutions will have the choice to access certain spot and derivative exchanges from cold storage. The partnership will allow the two to reduce the redundancy of having exchanges integrate with multiple custodians.

A press release on the announcement names ByBit, OKX, Bitfinex and Bitstamp as a few of the exchanges accessible.

“ClearLoop continues to be an important product for offshore institutional investors for mitigating counterparty risk and capital efficiency. With strong ecosystem partnerships, like BitGo, and the right architecture, we can finally see a maturation of distributed financial market infrastructure,” said Copper’s CEO Dmitry Tokarev.

Put simply, BitGo aims to “intentionally” separate “regulated custody from being able to still access liquidity in the market.” 

BitGo seeks to marry the “cold storage ability to manage those assets in a way that meets the needs of regulators but also allows those assets to stay connected to the marketplace,” BitGo’s managing director Matt Ballensweig told Blockworks.

The FTX collapse spooked both investors and institutions and though it’s been a year — with the anniversary of the bankruptcy announcement on Nov. 11 — some institutions and even retail investors are still reeling from the aftereffects.

The FTX chapter, however, is hopefully coming to a close with former CEO Sam Bankman-Fried found guilty of fraud and money laundering.

Ballensweig told Blockworks that BitGo — alongside many in crypto — wants to avoid another FTX.

“We’re exchange agnostic,” he said. “We’re not partial to a certain exchange, whereas, if you’re trading directly on the exchange, or that exchange has its own custody, or the exchange has its own capital market services, then then you’re obviously subject to the risk of that platform.”

As for who would be interested: Ballensweig confirmed that BitGo is “talking to a lot of hedge funds internationally about coming into the space for the first time.” He added that the firm has spoken to liquidity providers and market makers as well.

“This is a way to increase the overall pie globally amongst traditional firms that are…more established and derisk market structure in traditional assets. And that’s kind of what we’re recreating in crypto,” Ballenswig said.

The overall crypto market is working to put FTX fully in the rearview, and focusing more on general adoption. One of the primary focuses — shown by how quickly both investors and the markets jumped at a now-debunked post about BlackRock’s ETF approval — are spot bitcoin ETFs. There’s no clear indication if the Securities and Exchange Commission will approve the ETF applications, but analysts such as Eric Balchunas and James Seyffart feel optimistic.

Ballensweig admitted that ETF approval is “top of mind for us.”

“At this point, there’s no doubt the market has legs. There’s no doubt we’re at the precipice of mainstream adoption…Obviously, that’s gonna be the global catalyst that gets a ton of new eyes looking at the space.” 

The company, outside of the new partnership, received a license from the German Federal Financial Supervisory Authority (BaFin) earlier this week.

Prior to the license, BitGo operated in Germany under BaFin supervision as part of a “transitional regime.”

Ballensweig said that BitGo, going forward, is seeking to “broaden our reach into different segments of the market.” His focus is Go Network, the settlement network offered by the custodian. 

“We’re really trying to make Go Network, I would say, the primary utility layer that sits inside a qualified custodian for existing but mostly new market participants.”

Updated Nov. 3, 2023 at 4:36 pm ET: Added additional context throughout.

Updated Nov. 3, 2023 at 1:30 pm ET: Added comment from Copper CEO Dmitry Tokarev.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

Industry City | Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

Brooklyn, NY

SUN - MON, JUN. 22 - 23, 2025

Blockworks and Cracked Labs are teaming up for the third installment of the Permissionless Hackathon, happening June 22–23, 2025 in Brooklyn, NY. This is a 36-hour IRL builder sprint where developers, designers, and creatives ship real projects solving real problems across […]

recent research

Research Report Templates (19).png

Research

Suilend has grown into the top money market and liquid staking provider on Sui. STEAMM, Suilend’s Superfluid AMM, presents a compelling avenue for growing market share within Sui’s DEX landscape and revenue generation for the protocol. Suilend’s multi-product suite position it well for owning market share across key verticals. While current metrics across the Sui ecosystem are likely inflated due to Sui Foundation incentive programs, SEND trades at amongst the lowest multiples in the lend/borrow sector, suggesting that a bull case for continued growth in the ecosystem may be mispriced.

article-image

The best capital markets are open to the most people — and crypto capital markets are open to everyone

article-image

Post-conference musings on Firedancer, Kraken, Solana Mobile and Trump

article-image

Executives expect others to follow SharpLink Gaming’s lead in purchasing an asset that has surged this past month

article-image

After a weekend of tariff policy shifts, investors appear confident that trade deals are underway

article-image

Multiple rounds of prior audits did not catch the flaw, the DEX said

article-image

StarkWare launches new consumer-grade hardware ZK prover