Standard Chartered has entered a strategic partnership with fund manager 21Shares, providing crypto custody services amid the ongoing integration of traditional finance into the digital asset ecosystem. This move signals a broader trend of major financial institutions increasingly adopting crypto services, often leveraging their established reputations to gain a competitive edge.
According to a Monday announcement, Standard Chartered will oversee digital asset custody for 21Shares, which offers a variety of exchange-traded crypto products. Margaret Harwood-Jones, the bank’s global head of financing and securities services, emphasized that the collaboration extends the bank’s expertise into the rapidly evolving digital asset space. This initiative follows the bank’s recent launch of a cryptocurrency trading platform designed for institutional and corporate clients, allowing them to trade major cryptocurrencies such as Bitcoin and Ethereum.
Interestingly, 21Shares previously partnered with Zodia Custody, a crypto-native custodian co-founded by Standard Chartered in 2020. Zodia, operated as a wholly owned subsidiary, was established to serve institutional clients seeking specialized crypto custody solutions. It remains uncertain whether Standard Chartered will fully replace Zodia Custody or continue to operate alongside it, raising questions about the bank’s long-term custody strategy. The move underscores the increasing role of traditional banks as they expand into crypto custody, often with reputational advantages over crypto-native firms.
Other major banks are also expanding their crypto offerings. US Bancorp recently relaunched its crypto custody services aimed at institutional investors after a period of regulatory uncertainty, while Citigroup and Deutsche Bank are exploring custody and payment solutions for cryptocurrencies. These developments reflect a broader industry shift, as traditional financial institutions seek to capitalize on rising demand for cryptocurrency services.
Global Financial Institutions Embrace Crypto
As crypto enters mainstream finance, industry voices debate the evolving landscape. Some market analysts suggest that increased adoption by traditional banks could signal a turning point regarding the industry’s identity and future role within the broader financial system. Notably, recent movements of large Bitcoin wallets into ETFs have been interpreted as a sign that institutional investors prefer the convenience and regulatory assurances associated with traditional financial channels.
Robbie Mitchnick, head of digital assets at BlackRock, revealed that the firm has facilitated over $3 billion worth of Bitcoin conversions into ETFs, emphasizing the appeal of holding crypto exposure through regulated vehicles. Meanwhile, industry speculation continues about whether this trend will accelerate the decline of original crypto principles or serve as a gateway for further institutional participation.