Nasdaq creates Crypto unit, sees increased demand for digital assets among institutional investors

Initially, the new crypto unit will offer custody solutions for bitcoin and ether to institutional investors.

Nasdaq creates crypto-currency unit

Nasdaq, the world’s second-largest stock exchange, announced on Tuesday the launch of a new business called “Nasdaq Digital Assets“. Initially, Nasdaq Digital Assets will develop an institutional-grade custody solution, the release details, adding:

Nasdaq’s custody solution will bring together the best attributes of both hot and cold crypto-currency wallets.

Tal Cohen, head of North American markets at Nasdaq, told Bloomberg that the new crypto-currency group will initially offer custody services for bitcoin and ether to institutional investors.

Ira Auerbach, who led prime broker services at crypto-currency exchange Gemini, will head the new unit. Nasdaq’s offering is subject to regulatory approval in the relevant jurisdictions.

Adena Friedman, president and CEO of Nasdaq, explained, “Nasdaq Digital Assets builds on the successful solutions we have introduced in recent years to serve the digital asset ecosystem, including marketplace technology for digital asset exchanges, crypto-currency financial crime fighting offerings, and crypto-currency-related index solutions for tradable products.“

Cohen noted:

Demand from institutional investors to engage in digital assets has increased in recent years, and Nasdaq is well positioned to accelerate broader adoption and drive sustainable growth.

Nasdaq also announced Tuesday the expansion of its “financial crime fighting technology with new capabilities and coverage for the crypto-currency ecosystem“.

The company detailed:

Through its Verafin and Surveillance product offerings, Nasdaq has launched a comprehensive suite of cryptocurrency-specific detection capabilities.

The new tools will allow the company “Effectively mitigate risk and provide continuous monitoring of anti-money laundering, fraud detection and market abuse across traditional and digital assets, fiat and crypto, and on- and off-chain activities“, the announcement notes.

“As the world of digital assets evolves and converges with traditional finance, it is critical to provide the necessary portfolio of technology solutions designed to protect participants across the financial ecosystem” said Jamie King, head of financial crime at Nasdaq.