This article is also available in Spanish. Bank of New York Mellon (BNY Mellon) has made significant progress in launching custodial services for bitcoin (BTC) and Ethereum (ETH) following its recent exemption from the requirements of the U.S. Securities and Exchange Commission's (SEC) SAB 121 accounting bulletin.
As Bitcoinist reported earlier on Friday, BNY Mellon became the first bank to receive such an exemption, allowing it to not treat its #cryptocurrency assets as liabilities on its balance sheet.
This was revealed by Chris Rand, an advisor to pro-bitcoin U. S. Senator Cynthia Lummis, who confirmed that the SEC granted BNY Mellon this important exemption.
Bloomberg reports that BNY Mellon is close to launching a custody service for #bitcoin and Ether held by the company's exchange-traded products (ETP) customers.
the SEC's Office of the Chief Accountant General conducted a review earlier this year and did not challenge BNY Mellon's decision that custody of crypto assets of regulated ETP customers should not be recognized as a liability on the company's balance sheet. However, BNY Mellon cautioned that the decision does not address the broader issues surrounding SAB 121 and continues to limit the bank's ability to hold #digital assets.
BNY Mellon said it intends to continue working with the SEC's Office of the Chief Accountant to identify further use cases using a "facts and circumstances" approach. The bank said it is actively engaging with banking regulators to facilitate the provision of custodial services to cryptocurrency ETP customers on a broad scale.
According to the report, the market for cryptocurrency custody services is growing rapidly and is valued at around $300 million with an annual growth rate of around 30 percent. Providers can charge significantly higher fees for custody of digital assets than traditional securities, with costs that can be up to ten times higher.
These increased costs are largely due to the increased security measures needed to protect against cyber threats, resulting in significant financial losses for the digital asset industry.
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