Key Takeaways
- BNY Mellon is investing in crypto trading platform Pure Digital, along with five other banks.
- Pure Digital is aiming to compete with Coinbase and FTX for institutional clients.
- The move suggests BNY Mellon is seeing more institutional demand for cryptocurrencies.
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America’s oldest bank furthers its involvement with cryptocurrencies.
BNY Mellon Backs Pure Digital
The Bank of New York Mellon has joined five other banks in backing the institutional Bitcoin trading platform Pure Digital.
The 237-year-old institution announced its plans to add the institutional Bitcoin exchange Pure Digital to its list of crypto-based ventures Wednesday. BNY Mellon will join five other banks who are already backing the platform, including fellow custody bank State Street.
As reported by the Financial Times, BNY Mellon will provide public backing for Pure Digital. It also intends to trade on the platform. The report outlines how BNY Mellon, State Street, and the other unnamed backers aim to create a cash cryptocurrency trading venue to compete against larger industry players such as FTX and Coinbase. It’s set to become the first cryptocurrency trading platform led by banks. According to Pure Digital co-founder Campbell Adams, the first Bitcoin trade is scheduled to take place on the new exchange within a week.
Commenting on the Pure Digital partnership, Jason Vitale, global head of foreign exchange at BNY Mellon, said:
“Digital assets are only going to become more embedded in global markets in the years ahead, and this collaboration accords with BNY Mellon’s wider strategy to develop a digital asset capability for clients across the entire trade life cycle.”
BNY Mellon first started offering crypto custody services to its clients back in February, citing an increase in institutional interest. Since then, the bank has announced it will provide custody and management services for several high-profile clients, including Grayscale Investment’s illustrious Bitcoin trust.
Pure Digital CEO Lauren Kiley also commented on custody banks and crypto adoption. She stated that while Pure Digital had spoken to many top-tier banks, custody banks were more advanced as they were the first to see demand for crypto-related services.
In addition to providing crypto custody services for institutional clients, BNY Mellon has also actively invested in major players in the crypto industry. In March, the bank helped finance the crypto management firm Fireblocks with a $133 million investment.
As BNY Mellon increases its presence in the crypto industry through ventures like Pure Digital, the bank seems set on attracting institutional interest from traditional financial markets. While crypto markets have retreated from their highs earlier this year, institutional involvement with cryptocurrencies is showing no signs of slowing.
Disclaimer: At the time of writing, the author of this feature owned BTC and ETH.
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