An issuer of cryptocurrency exchange-traded products (ETPs), 21Shares, has partnered with Standard Chartered’s Zodia Custody to expand services to Europe.
The partnership between 21Shares and Zodia Custody is intended to address the growing demand for secure and compliant digital asset investments. Zodia Custody, supported by Standard Chartered, SBI Holdings, Northern Trust, and National Australia Bank, is renowned for its rigorous custodial services and stringent security measures.
Institutions that invest in 21Shares’ ETPs will benefit from Zodia’s sophisticated cold-storage wallets, which provide secure and immediate access to digital assets. Julian Sawyer, CEO of Zodia Custody, underscored that the partnership is designed to offer substantial advantages to the entire ecosystem of digital asset investments, guaranteeing that institutional investors have access to the most advanced security and compliance solutions.
In 2020, Zodia Custody was founded by Standard Chartered and Northern Trust. According to PitchBook data, the company has received $44 million from five investors. Zodia Custody’s most recent funding from NAB Ventures, the venture capital branch of Australia’s National Australia Bank (NAB), preceded the partnership announcement.
21Shares employs custodian services from other providers in addition to Zodia. The company’s website indicates that it relies on Coinbase Custody and Copper, a British crypto custodian established in 2018 by Dmitry Tokarev. However, whether the company will continue utilizing all custody providers is still being determined.
Increasing Institutional Interest in ETPs
Institutional investors increasingly express interest in exchange-traded products (ETPs) supported by digital assets. Nearly 1,000 professional investors collectively possess approximately $11 billion in US Bitcoin exchange-traded funds (ETFs), as per 21Shares. This accounts for approximately 20% of all ETF assets. In contrast, gold ETFs had a mere 95 investors in their initial quarter of operation, which accounted for less than 10% of Bitcoin ETFs.
The increasing interest from institutions demonstrates their growing adoption of digital assets as viable investment alternatives. Institutions are drawn to the transparency, ease of purchasing and selling, and potential for profits that ETPs provide. They regard digital assets as an essential component of their future investment strategy. This trend is compelling organizations such as 21Shares to create digital asset products that are both secure and diverse to satisfy the growing demand from institutional investors worldwide, as evidenced by this new partnership.
Market sentiment remains optimistic about prospective corrections despite the substantial outflows from digital asset investment products over the past week. The approval of Ethereum ETFs is also eagerly anticipated, as evidenced by the recent updated filings of prominent issuers.