While Street’s digital arm is working on the ability to custody crypto assets by the end of the year, tokenisation remains a top focus for the business going forward as institutions continue to show interest in the segment, reports Blockworks.
Using distributed ledger technology to tokenise funds and private assets, for example, to improve efficiency and accessibility is something the company is working on for 2023, according to Nicole Olson, a vice president of digital product development and innovation at the bank.
“[Tokenisation] is exciting for me because there’s a significant opportunity there for State Street to play and for State Street clients,” she said. “It’s broadly adding digital tech to those more traditional assets and bringing them into the future.”
State Street’s assets under custody and administration were $42.6 trillion as of June 30. Its asset management arm had $3.9 trillion in assets at that time.
Olson joined the company’s digital product development and innovation team in 2018. State Street formally revealed the launch of its digital finance division, renamed State Street Digital, in June 2021. Nadine Chakar leads the unit.
“That coincided with a doubling down or even tripling down of focus on digital at the bank,” Olson said. “We transitioned from being more experimental when I first joined, really encapsulated in innovation, to now it’s very much the future of the bank.”
State Street partnered with crypto asset data and software provider Lukka in July 2021 to help it provide digital and cryptocurrency asset fund administration capabilities for its private funds clients.
More recently, State Street Digital revealed in March that it entered into a licensing agreement with Copper.co to launch a digital custody offering for institutions. Copper.co provides custody, trading and settlement solutions across 450 crypto assets and more than 40 exchanges.
Olson said State Street Digital intends to offer the ability to custody some of the “blue-chip” crypto assets, such as bitcoin and ether, by the end of the year before introducing others.