Coinbase Goes for the Bigs with Coinbase Custody

As the march toward institutional investment in cryptocurrencies continues, Coinbase announced its launch of Coinbase Custody via a post from CEO Brian Armstrong on Medium today.

Billed as safe storage designed specifically for institutional investors, Coinbase Custody will accept customers with a minimum of $10,000,000.00 to store, charging $100,000.00 to set up the account and 10 bp monthly fee for assets under management, although pricing is subject to change.

Speaking to the demand for the custody product, Armstrong noted that “[o]ver 100 hedge funds have been created in the past year exclusively to trade digital currency. An even greater number of traditional institutional investors are starting to look at trading digital assets (including family offices, sovereign wealth funds, traditional hedge funds, and more). By some estimates there is $10B of institutional money waiting on the sidelines to invest in digital currency today.”

This shows the tremendous amount of money waiting for the institutional safeguards and recordkeeping of mainstream financial custodians to be in place before they will invest in cryptocurrencies.

Coinbase, which already runs the GDAX cryptocurrency trading exchange, believes it is well-positioned to move up to service large institutional investors as well.

Don’t worry if you are under their investment minimum right now, as Coinbase Custody is not set to roll out until early 2018 so you still have time to get your roll together.