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State Street Bank Ends Partnership with Cryptocurrency Custodian Company

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State Street Bank Ends Partnership with Cryptocurrency Custodian Company

According to reports, State Street Bank said it had ended its partnership with Copper, a cryptocurrency custodian company. A spokesman for State Street Bank said in an email that the two banks had jointly decided to terminate the license agreement. State Street Bank will continue to work on “providing multiple solutions for token based securities and native tokens”, adding that “the regulatory environment for digital assets has been evolving, and the requirements for providing services for this asset class are also changing.” Earlier on Thursday, Copper announced that it will close its enterprise infrastructure business and will focus on its Clear Loop custody and settlement business in the future.

State Street Bank has terminated its partnership with Copper, a crypto custody company

Analysis based on this information:


State Street Bank has ended its partnership with Copper, a cryptocurrency custodian company, according to reports. A spokesman for State Street Bank confirmed that the two banks had decided jointly to terminate the license agreement. This development follows Copper’s announcement that it will close its enterprise infrastructure business and focus on its Clear Loop custody and settlement business.

State Street Bank will continue to work on “providing multiple solutions for token based securities and native tokens”, highlighting that the regulatory environment for digital assets has been evolving, and the requirements for providing services for this asset class are also changing. This statement suggests that the bank is navigating the complex and changing regulatory landscape for digital assets, and may be exploring alternative partnerships or solutions to custody and settle cryptocurrencies.

The decision to end the partnership with Copper could be linked to State Street Bank’s growing concern about managing the risks associated with cryptocurrency custody, particularly given the uncertain regulatory environment. Cybersecurity risks, regulatory risks, and operational risks in cryptocurrency custody and settlement are significant challenges for financial institutions entering this market. However, other banks, such as JP Morgan and Fidelity, have recently launched cryptocurrency custody services, suggesting that some institutions are still willing to take on these risks.

Copper’s shift towards its Clear Loop custody and settlement business suggests that the company may be focusing on providing more specialized services to a narrower segment of the cryptocurrency market. Clear Loop is designed to simplify the settlement of digital assets, making it easier for institutional investors to enter the cryptocurrency market. This focus on streamlining custody and settlement processes may be a response to the growing complexity of the cryptocurrency market, and the demand for more efficient and user-friendly services.

In summary, State Street Bank’s decision to end its partnership with Copper highlights the challenges faced by financial institutions in the rapidly evolving cryptocurrency market. The regulatory environment remains uncertain, and managing the risks associated with cryptocurrency custody and settlement is a significant challenge for institutions. However, the growing demand for cryptocurrency services, particularly among institutional investors, suggests that we may see further innovation and collaboration in this space in the future.

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