Ben Strack

<div id="highlights-block_60f87cfc5beea" class="highlights">
 <ul>
 <li>Pure Digital to offer institutional investors a market for digital assets and cryptocurrencies with physical delivery and bank custody</li>
 <li>Banks working together an indication of “significant joint challenges and market change,” industry executive explains</li>
 </ul>
 
</div>



BNY Mellon is the latest bank set to collaborate with Pure Digital, an interbank marketplace for cryptocurrency price discovery and exchange of wholesale risk, to develop a platform for transacting digital assets.



Jason Vitale, global head of foreign exchange at BNY Mellon, said in a statement that digital assets will continue to become more embedded in global markets, noting that this collaboration aligns with the company’s wider strategy to develop a digital asset capability for clients across the entire trade life cycle.



The news comes after BNY Mellon, which has $45 trillion assets under custody, <a href="https://cms.blockworks.co/bny-mellon-offer-bitcoin-custody-this-year/" target="_blank" rel="noreferrer noopener">formed a digital assets unit</a> in February. The Wall Street goliath revealed at the time that it was developing a client-facing prototype that is designed to be the industry&#8217;s first multi-asset digital custody and administration platform for traditional and digital assets.



&#8220;BNY Mellon is one of the oldest and most widely respected financial institutions in the country, so its commitment to developing digital asset capabilities for its clients speaks volumes to the maturation of the crypto ecosystem as a whole,” Unstoppable Domains co-founder Brad Kam told Blockworks. “Banks need to innovate to compete, and those that haven’t announced plans to introduce crypto offerings are likely already working on plans and partnerships behind the scenes.”



BNY Mellon joins State Street’s Currenex unit, which Pure Digital selected in April to provide the trading infrastructure for its newly launched wholesale digital currency trading platform.&nbsp;



“I think that the move by BNY Mellon is telling in that they’ll be working with other banks,” said Jason Mochine, director of Marchare, a sales consultancy specializing in FinTech within the capital markets and digital asset arenas. “The only time the banks agree to play together is when they are facing significant joint challenges and market change.”



State Street, which has about $40 trillion under custody, has pushed further into the cryptocurrency space since announcing its partnership with Pure Digital by <a href="https://cms.blockworks.co/state-street-launches-digital-finance-unit-for-crypto/" target="_blank" rel="noreferrer noopener">launching a new division</a> focused on the shift to digital finance last month. State Street CEO Ron O’Hanley has called digital assets “a trend that’s here to stay.”



Fidelity’s digital assets division was <a href="https://cms.blockworks.co/fidelitys-digital-assets-division-reportedly-plans-to-boost-staff/" target="_blank" rel="noreferrer noopener">reportedly looking to increase headcount</a> as part of a push to leverage DeFi, tokenized assets and other blockchain capabilities. Bank of America launched a <a href="https://cms.blockworks.co/bank-of-america-launches-cryptocurrency-research-effort/" target="_blank" rel="noreferrer noopener">cryptocurrency research effort</a> earlier this month and was reportedly starting to allow certain clients <a href="https://cms.blockworks.co/bank-of-america-reportedly-to-offer-bitcoin-futures-trading/" target="_blank" rel="noreferrer noopener">to trade bitcoin futures.</a>



“Undoubtedly all banks will end up having to connect to infrastructure that can handle traditional and digital assets as the latter matures and, over time, replaces the former,” Mochine told Blockworks.



The Pure Digital platform will be a fully automated, high throughput OTC market for digital assets and cryptocurrencies with physical delivery and bank custody, the firm has explained. Its final platform, which is subject to regulatory approval, will leverage the firm’s FX trading industry infrastructure to offer users with stability, security, transparency and capital efficiency, the firm explained.



“As more top-tier banks join our initiative, we move closer to having an efficient wholesale crypto market,” Pure Digital CEO said in a statement, “which will ultimately lead to a more stable and mature asset class.”&nbsp;



A BNY Mellon spokesperson declined to comment and a representative for Pure Digital did not immediately respond.

BNY Mellon to Collaborate With Interbank Marketplace Pure Digital

Morgan Chittum

<div id="highlights-block_60f8532dbfad7" class="highlights">
 <ul>
 <li>Bitcoin is up 10% while ethereum jumped around 13% at press time </li>
 <li>Bitcoin had not traded below 30,000 since a volatile shakeout on June 22</li>
 </ul>
 
</div>



Bitcoin returned to its month-long trading range on Wednesday after buying pressures pushed the digital coin back above $31,000.



The cryptocurrency tumbled below $30,000 on Monday night after news broke of further attempted regulatory clampdowns on the asset class at large, including BlockFi’s cease-and-desist <a href="https://www.forbes.com/sites/stevenehrlich/2021/07/19/new-jersey-attorney-general-prepares-cease-and-desist-order-against-multi-billion-dollar-bitcoin-financial-services-platform/?sh=2fa6056321a5" target="_blank" rel="noreferrer noopener">order</a> from New Jersey’s attorney general.&nbsp;



“After the BlockFi news broke out, miners seemed to have moved a large number of bitcoins to exchanges overnight — around 32,000 Bitcoins, which put more selling pressure in the market,” BKCoin Capital founding principal, Kevin Kang, told Blockworks. “We haven’t seen a cascade of liquidations as we’ve seen earlier this year and muted reaction in both basis and funding rates shows that leverage has mostly been washed out since May 19.”



Bitcoin had not traded below $30,000 since its volatile <a href="https://cms.blockworks.co/north-american-miners-get-buy-rating-despite-bitcoin-price-slump-low-hashrate/" target="_blank" rel="noreferrer noopener">shakeout</a> on June 22.



Signals of further institutional adoption could have triggered crypto’s early morning rally. BNY Mellon has joined State Street and four other banks in offering custody support to a new crypto trading platform, Pure Digital. Following the <a href="https://www.ft.com/content/e02f954e-e30f-4d7e-a88e-801474dcfe27" target="_blank" rel="noreferrer noopener">Financial Times</a> report, Bitcoin jumped 10%. Ethereum was up 13% as well.



Bullish sentiments could also have been brought on by a slew of successful crypto-related funding rounds, announced Tuesday. FTX closed a $900 million<a href="https://cms.blockworks.co/ftx-closes-900m-series-b-round-valuing-exchange-at-18b/" target="_blank" rel="noreferrer noopener"> funding round</a>, the largest raise in crypto exchange history. This brings the trading platform to a $18 billion valuation. And fintech firm Titan raised $58 million in a funding round led by VC giant Andreessen Horowitz.&nbsp;



“It&#8217;ll be interesting to see if this support will keep its strength. If it tests the support again, we would probably not see such a bounce and face a sell-off to $23k,” Cryptohopper CEO Ruud Feltkamp said in a note. “While trading in the summer usually isn&#8217;t that interesting, there&#8217;s a lot of uncertainty in the market.”



Bitcoin was trading at $32,841.19 at press time.&nbsp;



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