The Bank of New York Mellon is supporting a new cryptocurrency effort by providing custody services to a new crypto exchange funded by State Street.
As shown in an article published on Wednesday by the Financial Times, BNY Mellon has joined a consortium of six banks in support of the launch of Pure Digital, a new cryptocurrency trading platform based in London that is expected to conduct its first Bitcoin (BTC) trade in the coming weeks.
In April, State Street announced plans to provide its trading infrastructure to the Pure Digital exchange through its foreign exchange technology business Currenex, bringing the impending crypto venture into the spotlight of the financial industry.
Physical delivery of cryptocurrencies, as well as bank custody, are expected to be provided via the institutional-grade platform, which will be a completely automated over-the-counter exchange for cryptocurrencies.
Pursuant to the report, BNY Mellon and State Street, as well as other unnamed banks affiliated with Pure Digital, will establish a cash cryptocurrency trading platform in an effort to compete against larger industry players, including Coinbase and Coinbase Pro.
According to Pure Digital CEO Lauren Kiley, the company has spoken with all of the top-tier banks but believes custodial institutions were among the first to recognise a need and are therefore more advanced.
The co-founder of Pure Digital, Campbell Adams, has reportedly stated that the company aims to launch trading “within a week,” with the first trade likely to involve a Bitcoin transaction.
Pure Digital’s CEO also stated that the company is not concerned about partnering with financial institutions, expressing confidence that the bank’s involvement is critical to the industry’s uptake. According to him, “the cryptocurrency market requires banks; I do not believe it can scale without them.”
According to the latest news, cryptocurrency adoption by financial institutions in the United States has reached a new high point, with both BNY Mellon and State Street becoming more actively involved in the space.
The financial services company BNY Mellon has extended its foray into the cryptocurrency space since announcing crypto custody ambitions in February, most recently becoming an exchange-traded fund service provider for leading crypto asset management Grayscale Investments.
Known for its digital currency collaboration with Winklevoss brothers’ Bitcoin exchange Gemini, State Street is a leader in the industry. Recently, the bank established a specialised digital finance division that would focus on bitcoin, blockchain technology, and central bank digital currencies, among other topics.
