Coinbase Custody Receives License from NYDFS, Coinbase Exchange Lists USDC Stablecoin
Coinbase Custody has acquired a license under New York State Banking Law to operate as an independent Qualified Custodian. “Coinbase Custody will operate as a Limited Purpose Trust Company chartered by the New York Department of Financial Services (NYDFS),” reads Coinbase’s latest blog post.
Coinbase Custody is a “standalone, independently-capitalized business” to Coinbase Inc. that offers top-grade large-scale cryptocurrency storage aimed at institutional investors. Coinbase Custody’s newly acquired license plays a key role in the company’s mission to add major Wall Street investment firms to its clientele.
“For our customers, operating under a New York State Trust Company is more than just a new license — it’s an important piece of regulatory clarity that will allow us to compliantly store more assets and add new features like staking,” reads today’s announcement.
The post continues:
“[Coinbase Custody] will be held to the same compliance, security and capital requirements as traditional fiduciary custodial businesses like the DTC. This means customers can trust that the company has met the rigorous banking standards of NYDFS regarding capitalization, anti-money laundering procedures, confidentiality, security and storage. The trust charter also designates Coinbase Custody as a fiduciary under New York State Banking Law.”
It’s worth mentioning that last week, major Wall Street investment bank Goldman Sachs announced that it had executed a $15 million joint investment with former Goldman partner Mike Novogratz into BitGo Holdings Inc.’s developing cryptocurrency custodian platform. BitGo has now raised approximately $70 million in fundraising rounds. It is suspected that Goldman intends to support BitGo’s development as a trusted custodial agent in an effort to further its own deepening involvement in the digital money space.
Suggested Reading : Learn why Coinbase is one of our favorite exchanges for 2018.
Coinbase Announces Support of USDC Stablecoin
Meanwhile, leading cryptocurrency exchange Coinbase has announced that it will now be listing the USDC stablecoin. USDC is pegged at a 1:1 value with the US dollar, and is one of the many new stablecoins gaining popularity in recent weeks.
“This is the first time Coinbase has supported a stablecoin, which is fundamentally different from other cryptocurrencies,” Coinbase writes in its blog. “The advantage of a blockchain-based digital dollar like USDC is easier [sic] to program with, to send quickly, to use in dApps, and to store locally than traditional bank account-based dollars. That’s why we think of it as an important step towards a more open financial system.”
Stablecoins like USDC make for easy transfers between accounts, help protect investors against market volatility and help maintain a consistent cash value to investor’s crypto portfolios. As an ERC-20 token, USDC has the added advantage of being usable in the Ethereum dApp ecosystem and functions as a programmable dollar for developers on the Ethereum blockchain.
The USDC token was created by crypto finance company Circle, who has now formed an official partnership with Coinbase called CENTRE Consortium:
“Today’s launch is made possible by the collaboration between Coinbase and Circle, as co-founders of the new CENTRE Consortium. Both Coinbase and Circle operate with a compliance-first approach and a track record of security. That’s why we believe CENTRE is uniquely positioned to offer USDC to people who want to take advantage of the benefits of stablecoins.”
Coinbase reports that USDC will be available on Coinbase Pro within the next month. The token is already supported on the Coinbase Wallet.
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