Asian Asset Manager Focusing on Family Offices to Launch Crypto-Custody Solution
The Fusang Investment Office, an Asia-based fund management firm focusing on family offices, is planning to launch a crypto-custody service in Hong Kong, local news outlet the South China Morning Post reports Sunday, July 22.
The custody service, Fusang Vault, will hold digital assets for clients as well as provide periodic audits, according to the company’s CEO Henry Chong. The service’s launch is planned for the fourth quarter of 2018.
Comparing digital assets to financial bonds, Chong noted the increasing need to provide an independent third party that would hold clients’ crypto assets, just like a demand for custodian bank services in conventional finance.
Chong stressed that since holding digital assets lacks the registration of ownership data, a crypto-custodial service is of “paramount importance”:
“Digital assets are akin to bearer bonds, whereby whoever that is holding the security is presumed to be the owner and there is no registration of ownership information of the security. Hence, the way we keep digital asset [sic] secured is of paramount importance.”
Fusang’s CEO added that the firm is already working with insurance companies to safeguard clients’ digital assets, without specifying features of the upcoming Fusang Vault service.
According to its website, the Fusang Investment Office is regulated by the Monetary Authority of Singapore and licensed by the Securities and Futures Commission of Hong Kong.
In early July, one of the world's largest cryptocurrency exchanges, Coinbase, launched a crypto-custodian solution targeting institutional clients. Coinbase Custody is operated through an independent member of the U.S. Financial Industry Regulatory Authority (FINRA) in compliance with the U.S. Security and Exchange Commission (SEC).
At the end of June, Cointelegraph published an Expert Take on the financialization of the crypto ecosystem, noting the entrance of custodial solutions as a sign of more institutional investors coming in.