Nexo Taps Bakkt to Custody Customers’ Ether and Bitcoin

A portion of Nexo’s digital assets are to be held in the Bakkt Warehouse, the company’s custody platform

article-image

Vintage safety deposit box and key. Credit Shutterstock

share

key takeaways

  • Nexo will use Bakkt’s Warehouse to safeguard its user’s crypto
  • The custodian joins Nexo’s growing list including BitGo and Fidelity Digital Assets

Cryptocurrency loans, lending and exchange platform Nexo has tapped Bakkt’s custodial services to safeguard its customer’s ether and bitcoin holdings.

The digital assets are to be held in the Bakkt Warehouse, the company’s custody platform, according to a statement on Wednesday. Bakkt was founded by the Intercontinental Exchange, the parent company of the New York Stock Exchange.

Bakkt said its warehouse comprises both online (warm) and offline (cold), “air-gapped” digital asset storage and acts to rebalance between warm and cold storage tiers to minimize the risks associated with holding assets online.

“We recognized that Bakkt’s infrastructure and regulation-first approach to crypto was a natural fit,” said George Manolov, Nexo’s business development executive. “We’re confident that this partnership will benefit all our clients and expand Nexo’s ability to service the unprecedented institutional demand for cryptocurrencies.”

According to data by provider Blockdata, 8-10% of all crypto, roughly $250 billion out of $2.1 trillion are now held by compliant custodians.

Crypto exchanges including Nexo, Bitstamp and Crypto.com rely heavily on third-party custodians to safeguard their user’s digital assets. Hedge funds, institutional investors and corporates trading or investing in millions also use custodians in order to offset the risk associated with storing large amounts of crypto, as they are typically insured by the provider.

Nexo already relies on Galaxy Digital’s BitGo for custodial services as well as Fidelity Digital Assets, which partnered with Nexo in December to develop compliant infrastructure for institutional investors seeking exposure to crypto.

“The cryptocurrency market continues to expand at a robust pace leading reputable crypto companies to diversify custody of assets,” said Dan O’Prey, Chief Product Officer of Crypto at Bakkt in the statement. “We are pleased that Nexo has chosen the Bakkt Warehouse as a trusted solution.”


Get the day’s top crypto news and insights delivered to your email every evening. Subscribe to Blockworks’ free newsletter now.


Want alpha sent directly to your inbox? Get degen trade ideas, governance updates, token performance, can’t-miss tweets and more from Blockworks Research’s Daily Debrief.


Can’t wait? Get our news the fastest way possible. Join us on Telegram and follow us on Google News.


Tags

upcoming event

MON - WED, MARCH 18 - 20, 2024

Digital Asset Summit (DAS) is returning March 2024. This year’s event will be held in our nation’s capital, where industry leaders, policymakers, and institutional experts will come together to discuss the latest developments and challenges in the ever-evolving world of cryptocurrency. […]

upcoming event

MON - WED, SEPT. 11 - 13, 2023

2022 was a meme.Skeptics danced, believers believed.Eventually, newcomers turned away, drained of liquidity and hope.Now, the tide is shifting and it’s time to rebuild. Permissionless II is the brainchild of Blockworks and Bankless. It’s not just a conference, but a call […]

recent research

Curve's Stablecoin and Lending Market

Research

AMMs are at the root of everything elegant and useful in DeFi.That's why Curve put LLAMMA at the center of its lending protocol.

/

article-image

Despite MiCA’s passage, both ESMA and Europe’s Systemic Risk Board want to ensure crypto is regulated and investors are protected

article-image

Bloomberg found that nearly half of crypto companies recently surveyed receive audit services from Deloitte, EY, PwC or KPMG

article-image

Hong Kong is “rich in tycoons and well-capitalized family offices that could fund crypto firms moving into the city,” Matrixport’s head of research told Blockworks

article-image

Lummis originally made critical comments of the Biden Administration’s tax on bitcoin miners at Bitcoin Miami, but retweeted an article summing up her views on Thursday

article-image

Starbucks Odyssey is the company’s Web3 rewards beta program, which is currently only available to select individuals

article-image

Coinbase demanded that the SEC offer clarity on crypto regulation