The cryptocurrency market is valued at $2 trillion and has led to the emergence of the crypto custody sector, currently worth about $300 million and growing at 30% annually. However, crypto custody comes at a high cost, up to ten times more than traditional asset protection, due to the unique challenges of securing digital assets in a space prone to hacking. Despite the high costs, major financial institutions like BNY Mellon, State Street, and Citigroup are interested in entering the market, but regulatory uncertainty is a significant hurdle. The upcoming US presidential election could impact the market, with overseas providers considering a renewed focus on the US depending on the outcome. Currently, crypto-native firms like Coinbase and BitGo dominate the market, but traditional financial institutions like JPMorgan Chase and State Street are also making moves in the space. Recent settlements by Robinhood Markets and Galois Capital with US regulators highlight the importance of qualified custody for institutional investors.



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