The main obstacle that has been hindering the flow of institutional money into the crypto market can soon be solve due to instruments such as the Namoura Consortium.
Robert Dykes writes: “There are jurisdictions where it is illegal for an investment fund with more than $150 million under management to custody their own assets. Institutions have to work with trusted third-parties — banks and financial companies — that hold their assets in legal safekeeping”.
Dykes blames global regulators because “they have shown little consistency on how to allow innovation in blockchain technology while minimizing risks for investors and the financial system.”
Nomura, Ledger, and Global Advisors jointly create the Consortium Komainu. According to Bloomberg, Bank of New York Mellon Corporation, JPMorgan Chase, and Northern Trust Corporation are already working on or exploring these custody services.
Hedge fund manager Kyle Samani notes: “There are a lot of investors where custodianship was the final barrier. Over the next year, the market will come to recognize that custodianship is a solved problem. This will unlock a big wave of capital”.