Anchorage Digital, the first and only federally chartered crypto bank in the U.S., has been named the custodian for 21Shares, a leading issuer of crypto exchange-traded funds (ETFs), according to a joint statement released Thursday. BitGo, another prominent custodian, will also partner with 21Shares.
The custody agreement includes the ARK 21Shares Bitcoin ETF (ARKB), which ranks third for inflows behind BlackRock and Fidelity, as reported by Farside Investors. Anchorage will also oversee the 21Shares Core Ethereum ETF (CETH). Notably, ARK Invest, led by Cathie Wood, partnered with 21Shares for the Bitcoin ETF.
“21Shares is excited to collaborate with Anchorage Digital Bank and BitGo to diversify our custodial partners for U.S. spot ETPs,” said Andres Valencia, head of investment management at 21Shares. “Custody partners are vital for risk management and operational excellence, and diversification enhances the safety and security of our product lineup.”
Diversifying custody arrangements is a growing trend among crypto issuers. Earlier this year, Valkyrie added BitGo as a custodian for its Bitcoin Fund (BRRR).
Nathan McCauley, co-founder and CEO of Anchorage Digital, expressed pride in being chosen as a custodian for 21Shares’ ETF products. “Our federal charter, which supersedes state-by-state regulation, positions us as a qualified custodian and a natural choice for ETF custody diversification,” McCauley stated.
Crypto ETFs were introduced to offer broader access to regulated cryptocurrency investment products, making it easier for investors to trade digital assets. The custodians responsible for managing billions in assets behind these products play a critical role in their safekeeping.
To date, Coinbase has led in providing custody services for the U.S. exchange-traded product (ETP) market, which encompasses ETFs. However, Anchorage Digital emphasized its legally mandated segregation of assets as a regulated bank under the Office of the Comptroller of the Currency, a feature that protects assets from bankruptcy risks faced by other crypto firms. Anchorage also highlighted its cutting-edge security measures, including biometric authentication and offline private-key storage.
Custody has emerged as a key issue in the crypto sector, particularly with the U.S. Securities and Exchange Commission (SEC) pushing for a rule that would require registered investment advisers to store clients’ crypto assets with “qualified custodians.” If this strict definition is adopted, Anchorage Digital, as a federally regulated bank, along with registered broker-dealers like Prometheum Inc. and tZero Group Inc., would be among the few firms qualified to provide this service.
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